Tuesday, March 18, 2008

Why There's No Entitlement Crisis

There would be an entitlement crisis if the Feds were actually required to pay entitlements and the Feds had no assets. Neither of these suppositions is true.

Let's take the big three - Medicaid, Medicare, and Socialist Insecurity. Medicaid is pure welfare. Medical 'insurance' for the poor. Welfare can be cut any time -- see 1996 -- without the recipients being able to do anything about it. Medicare is welfare too. Originally created without any dedicated taxation, it was the gift of a grateful Congress to the nation. It can be cut any time. Socialist Insecurity seems like an 'entitlement' but, in fact, the Supremes have ruled that Congress can cut off anyone it likes (even if they've paid FICA contributions all their lives). Read it and weep:

FLEMMING v. NESTOR, 363 U.S. 603 (1960) -

To engraft upon the Social Security system a concept of "accrued property rights" would deprive it of the flexibility and boldness in adjustment to ever-changing conditions which it demands. See Wollenberg, Vested Rights in Social-Security Benefits, 37 Ore. L. Rev. 299, 359. It was doubtless out of an awareness of the need for such flexibility that Congress included in the original Act, and [363 U.S. 603, 611] has since retained, a clause expressly reserving to it "[t]he right to alter, amend, or repeal any provision" of the Act. 1104, 49 Stat. 648, 42 U.S.C. 1304. That provision makes express what is implicit in the institutional needs of the program. See Analysis of the Social Security System, Hearings before a Subcommittee of the Committee on Ways and Means, House of Representatives, 83d Cong., 1st Sess., pp. 920-921. It was pursuant to that provision that 202 (n) was enacted.

We must conclude that a person covered by the Act has not such a right in benefit payments as would make every defeasance of "accrued" interests violative of the Due Process Clause of the Fifth Amendment.

So bennies can be cut or eliminated at any time.

Then there's the issue of assets. The Feds own almost 30% of US real property. Hard to say what that's worth but it amounts to a fair chunk of change. Included in this portfolio is prime Manhattan real estate, the headlands on both sides of the entrance to San Francisco Bay, acres on Waikiki Beach, a stretch of the NE Pacific ocean 400 miles wide by 1400 miles long (560,000 square miles) with all its resources, all of the oil and other resources of the outer continental shelf at least 200 miles off all the coasts of the US, a large island in the Virgin Islands, most of Alaska, etc.

Worth a pretty penny.