And your math is right on a year-by-year basis. But the above numbers were unfunded liabilities — public companies have to list these things on their balance sheets, but government entities don’t have to. [Though there's currently effort to force cities to properly account for their pensions.] So we’re not paying much now, but the actuaries know we’ll be paying a lot more later. And you sum up all of those discounted cash flows, and you get $36-38T. This is what we would need to pay today in addition to the normal payments later in order to break even.

Answer is given towards the bottom of the post.

1. $38.6 Trillion – E. Medicare’s unfunded gap. The other number that’s tossed around a lot is from the 2008 trustee’s report- you can breathe a sigh of relief there, it’s only $36.3 Trillion.

2. $11.9 Trillion – A. The equity value of all residential housing in the United States (Federal Reserve Board figure for end of 2007).

3. $13.7 Trillion – C. United States Gross Domestic Product (2007 via CBO).

4. $7.1 Trillion – D. Present value of unfunded Social Security Obligations (2008 Trustee Report, probably optimistic)

5. $2.7 Trillion – F. Sum of all Federal Budget outlays (Fiscal Year 2008 budget of the United States)

6. $0.5 Trillion – B. United States Defense Budget (Fiscal Year 2008 budget of the United States).

Sadly, No.
http://www.bls.gov/news.release/empsit.t12.htm

Total unemployed, plus all marginally attached workers is 9.2% Just because I stopped looking for work doesn’t mean I found a job.

There are several things wrong with your statements:

1) Of course you would expect tax revenues to be closely linked to the GDP: The GDP is a measure of income and consumption, both of which are taxed. Increase the GDP, increase the tax revenue. This is not a surprise, no matter which side of tax cuts you re on.

2) I’m not sure about the “top tax rate,” but if you look at the correlation to income tax with tax revenues, you will see a very strong correlation: See graph at http://taxation-business.com/weblog/december_2005_graph.JPG. Every little bump in the tax rates is exactly correlated with a little bump in the tax revenue (shown here as a percentage of GDP. Since the GDP is also expanding, the percentage stays mostly stable).

3) Note the tax cuts in the early 2000s and their effect on tax revenue. “Ah ha!” you say, “that’s not because of the tax cuts, that’s because of 9/11.” Well, yes, in part, but not completely. See graph here: http://stubbornfacts.us/files/tax_revenues_gdp_1992-2005.gif. You can see that after 9/11, the GDP continued to rise significantly. However, tax revenues FELL (countering your first point.

GDP continued to rise, tax cuts were made, tax revenues fell. Which variables are more closely correlated?

We’ve also been monitoring comments to find suggestions for improving the game, ideas for new policy options, or to spot technical problems.

Based on the feedback that we’ve received here and elsewhere, we’ve added several new policy options to the game:

End No Child Left Behind (Schools & Learning)
Increase NSF grants by 50 percent (Science & Nature)
Cut NSF grants by 50 percent (Science & Nature)
Double funds for alternative energy (Science & Nature)
Ground the space program (Science & Nature)
Stop exploring Earth from space (Science & Nature)
Increase NASA funds by 50 percent (Science & Nature)

Sorry, but you’ll need to play the game again to see how much each of these spends or saves!

We’ll be adding more options to the game as new policy proposals crop up during the campaign season. If you have any other ideas for cards we should add, or any further suggestions or feedback, please send them to me at budgethero@mpr.org.

Srini Radhakrishna

That would give more power to people who pay more tax, i.e. the rich.

Which would basically turn the US into a publicly traded corporation – the more stock you own, the more votes you have.

And we all know how beneficial giant corporations are to our society.

–K

Firstly, “Unemployment” and the CPI are not lies — they are consistently measured on a well defined standard on a stastistical sample. That their definitions do not satisfy the layman’s interpretation is no reason to ignore them. Even the 9.2% figure you gave does not include, say, the housewife who would rather work but could not then afford daycare. That there is a large amount of standardized historical data is a great boon. It may not measure what it claims to measure, but it measures it consistently.

Secondly, you overestimate administration influence on the actuaries’ reports. In fact under Clinton, the forecasted liability was even larger. Using the SS Trustee report as an example, the 2008 75-year unfunded liability was 20% smaller than the 1999 one. These were caused by more optimistic growth assumptions. If you think this administration is exaggerating that liability, then Clinton’s was worse.

You’re laughable if you think ignoring these numbers is a better use of critical thinking than analysing them while acknowledging their imperfection. You have done nothing but advocated the former.

Well, I’m glad someone sees this. Not sure I agree that we should treat the whole nation as one, though. Maybe stick with the one-person one-vote thing, but limit it to tax payers?

It seems to use the 9″ pie model of economics: raise taxes 5% and revenue increases by 5%; lower taxes 5% and revenue decreases by 5% (sort of like how the Congressional Budget Office models taxes). Raise taxes? Free money! Lower taxes? Instant budget death! Never mind the effect of either on economic behavior.

There’s an interesting set of charts I saw that demonstrate that tax revenues are very closely correlated with GDP. (It’s been been close to 18% of GDP for the last 50-60 years.) Meanwhile, the correlation with the top tax rate (which was around 90% in the 50s) is minimal to nil. This suggests that if you want to raise tax revenue (which isn’t necessarily the goal, but I’m just sayin’), what you really want to do is encourage business and personal financial prosperity.

I can only guess that you have recently stumbled upon the fact that economists have more than one category for people not working. Anyone who is familiar with those statistics knows that definition.

Why are you not pulling up other numbers, like employment-population ratios? That would also include people who have withdrawn themselves from the labor force entirely, for any reasons. I can only imagine because these “new unemployment” numbers sound surprising when compared to “old unemployment” numbers. But that alternative metric has always been 3-4% higher as long as it has been tracked.

By meaningless I mean the 0.5 trillion for defense. This is a cooked figure because we’ve already spent 1 trillion in Iraq alone so far. But I know, I know, the 0.5 is the defense budget, our spending in the MidEast is “off budget” therefore you (or someone) are really just playing games.

I bet you think unemployment is at %5 don’t you?

2) Wrong, they currently do have unfunded liabilities according to actuaries. What they are not are “bankrupt” or “insolvent” in 10 years. Those unfunded liabilities are just going to be paid for out of general revenues instead of their specific revenues or by having benefits reduced. I suppose you could say that it has no unfunded liabilities, but you could then use that same logic applied to the pensions in San Diego or GM no matter what their financial strength. Those pensions are going to be paid out as long as they can, until benefits are reduced. If SS has no unfunded liability, then no pension does.

I’m not sure how you go from 0.5 trillion to “we just don’t know!” because you can estimate it offhand. This site here (via Wikipedia) breaks down actual spending pretty well. Overages of 25% or so seems normal since the wars began. So it’s off by a digit. What difference does that make to the rest of the numbers?

And yes, unemployment is at 5%. I bet you didn’t know how unemployment was defined until recently, didn’t you?

It was an April Fools Day prank.

Hint #1: Unfunded medicare obligation conclusion on p197 in the pdf linked in this summary.

Hint #2: For social security, the 2008 Trustee report actually gives an unfunded obligation of $13.6 trillion.

Seriously, ten clicks and I was in surplus, with a government both serious and responsible, well on the “small” side of the swinging needle.

The people in charge now are neither serious nor responsible, however.

I cut military spending to levels to face credible threats. And got the hell out of Iraq, now.

All fair and in keeping with sound, conservative practices.

I had more money than I knew what do do with. Literally. Could not get a deficit no matter what.

If these figures are accurate, it’s a sad, sad thing that something so common-sense is so difficult to pull off.

Now, am I just better at this than everyone in Washington, or are they evil, or does the game have a political motive? Who can say?

trai_dep — you are assuming they have the same goals that you do. The Bush admin is on record that they want to destroy the economy. Stealing from the public trough is the whole point of a Kleptocracy.

Maybe it only allows what they consider politically possible, but some of the options given also seem like they’d be politically impossible.

Including sales tax? So all you would need to get the vote would be to buy a pack of gum?

Or do you have only some other kind of tax in mind? Income tax and/or property tax, perhaps? Since that would exclude welfare recipients or people with no taxable income or property, and thus disenfranchise the poor, this would put proportionally more power in the hands of the rich.

Maybe that’s what you want?

The game is basically structured so your only out is to cut defense spending and raise taxes.

Yes. Reality has a liberal bias, doesn’t it?