Friday, February 19, 2010

Peggy Noonan Doesn't Get It Either

Peggy Noonan's op-ed in the Wall Street Journal is a good example of why we never make any progress on spending and on the national debt. She blithely perambulates about how "fairness" in the process of cutting spending is the big issue. What blather! One can only conclude that Noonan's response to the coming debt crisis is one of necessity but not one blessed with any knowledge of what the real problem is.

Take a note, Peggy. The problem is entitlements. They need to be phased out....not cut...phased out. No system of retirement and medical entitlements has any chance of surviving over the long run. The political system, Republicans and Democrats, constantly raise the payouts to the entitled without providing any means of funding the entitlements. Your opinion piece seems unaware of this. Your opinion piece seems to suggest that if we cut this and that and all smile together in self satisfaction that we can get there. We can't.

Spending as spending is not the problem. You can build all the roads and construct all the parks and fight all the wars you want. Those things don't cost much and don't distort incentives. What matters are two things: 1) share of GDP that represents permanent, paid government employees; 2) social security and medicare. Nothing else really matters, Peggy. Go luck at the numbers.

Opinion puff pieces like Peggy Noonan's today in the Wall Street Journal set back a serious discussion on how to deal with the national debt. Her approach is no different than the pathetic approach of our young President. Most of her article is in praise of Obama's recently announced "bi-partisan" commission to study the national debt. Such a commission will not help. The national debt problem is not some mysterious thing that needs further study. It needs a bill in Congress to begin to lower the size of government and the number of folks working for the government and to begin the process of phasing out the entitlements. Nothing short of enacting legislation such as this will save the country from bankruptcy.