Praising The Electorate

We have, rightly we think, complained about the candidates the two parties have produced recently. All of the Democrat nominees for president in a year starting in 2 have been unimpressive but they have won several time in general elections. They have won because the quality of GOP presidential nominees has waned with the Democrats. The GOP, however, has outdone the Democrats on nominating candidates for senator. Their choices include a football player, a football coach, a celebrity doctor that didn’t live in the state, and one that had to declare, “I am not a witch.”

Sidebar: Of course the statement above is unfair to all football folk. Jack Kemp was a football player of some note that became a GOP politician of some significance. End Sidebar.

At least one of them won. And then, of course, the GOP has George Santos in the House.

But today we have come to praise the electorate. Over at the NRO Corner, Ramesh Ponnuru has a short report on income inequality that connects to a longer piece at Politico. Here is what Ramesh said:

From 2017 through 2022, wages at the bottom of the labor market have been rising faster than at the top. [yea for The Donald?] The trend was especially pronounced from 2020 through 2022, when wages for high earners dropped. So concludes an analysis by Victoria Guida for Politico.

The fact that Biden’s job-approval rating, and his rating on the economy in particular, is so low suggests that voters care a lot less about income inequality per se than they do about broad-based wage growth. Politico’s analysis shows that middle-income workers have been losing ground as inflation erodes their paychecks. [Emphasis Added]

Yes, we did quote Ramesh’s whole post so you don’t need to read it. We are not sure if that is improper but we really need you to see what Ramesh said so we can discuss it. Perhaps we do need an editor. We also note that The Frontrunner did not become president until January 2021 and there is sure to be a lag between becoming president and having an impact on wages so we put a “yea The Donald” in. Still, some of the reduction in income inequality comes under The Frontrunner’s aegis.

We have come to praise the electorate because they should care much, much more about broad-based wage growth (and economic growth) than they do about income inequality. Voters in the US shouldn’t care about income inequality or equality at all. The exact Gini Coefficient and debates over how to measure it shouldn’t matter at all.

At all? Well, we did say the US and we would expand it to any other country with at least, say, a Moderately Free economy according to the Heritage Index. JFK overstated it when he said a rising tide lifts all boats but economic growth lifts many, many boats and provides the resources for individuals or organizations, but not limited to the government, to attend to the boats in distress. So let us praise the electorate for recognizing that income inequality isn’t an issue of any significance. We are not as sure we will get the same answer when the demagogues gin up the envy monster but it is a step in the right direction for the electorate. Well done!

Vote For The Frontrunner in 2024?

We have aways phased the question about presidential election in 2024 as: should we vote for the GOP candidate or should we just vote for the other positions? After reading Kevin D. Williamson’s post on the war in Ukraine at The Dispatch we are reminded of other options. Of course, you should always read all of Kevin and try to afford The Dispatch. Not everything there is to our taste but Kevin and Scott are worth far more than what we pay. Here is Scott at the WSJ if you have that subscription.

What we are thinking about is voting for the current president, The Frontrunner, in 2024 if the GOP nominee signals that he is prepared to abandon Ukraine to Putin and the Russians.

Sidebar: The imperfect comparison is 1996 with Bob Dole versus Bill. After the 1994 elections, Bill and Newt were pretty reasonable on economics for the next two years. It was reasonable to vote for Bill and think that a GOP led Congress could work with a Democrat president. A quick history might be that it was a good voting strategy that was ruined by Bill getting caught with his pants down. End Sidebar.

Here is Kevin’s conclusion (paragraph break deleted):

There are some Americans, many of them Republicans, who believe that we can more or less ignore the choice [about Ukraine versus Russia] in front of us, or else that we can finesse it politically with craven talk about “blank checks” and such. Go stand at that bridge in Irpin [where the Russians were stopped short of Kyiv] or at the site of the mass grave in Bucha [where Russians mass murdered Ukrainians]. If you know where to look, you can see the American interests from such vantage points.  Now, what are we prepared to do about it? [Emphasis added]

We don’t know where the 2024 GOP nominee will stand on Ukraine but he might go “America First” and stop or reduce US support of Ukraine. Of course, America First doesn’t really compute as the Americans paying tariffs or the Americans that can’t find baby formula will tell you. So if the Democrats nominate Biden, who can only serve four more years, and the GOP nominates an American First type we might support Biden in 2024 and hope for something better in 2028. It is not a done deal but it is worth thinking about.

David, Dan, And MWG On RonD

David French, a mainstay of the NeverTheDonald tribe, has gone after the new candidate for the GOP nomination for president, Ron DeSantis or RonD. As we are not going to pay for the NYT we will have to rely on what Dan McLaughlin at NRO has reported. You should read all of Dan’s post. We can’t vouch for David’s but if you can get past the NYT paywall give it a try. We will start with Dan’s title: No [RonD] Will Not Destroy Conservatism. Later he quotes David as saying that RonD could end conservatism as we know it. We don’t know the whole context of the quote but that way overvalues RonD or anyone else’s impact on conservatism.

We are entirely with Dan on this one but not for the rationale he gives. We would like to highlight the differences between David, Dan, and MWG and use RonD as an example. As we said we have not read David on RonD but we have read enough of him to understand his style and approach. David is very much a procedural legal thinker. The lawyers at PowerLine tend to exhibit this as well but it is not as developed. One of the tax guys at one of my schools had this too. He was always worried if he did something for one student then he would have to do it for all of them. We told him that it was within a professor’s purview to make judgments but he never really accepted our advice. In addition, free speech is very much a priority for David. From both his emphasis on procedure and his priority on free speech make David highly agitated about RonD.

Despite being a lawyer, Dan is a pretty philosophical guy as his post reflects. His second paragraph goes like this:

For classically liberal American conservatives, there are timeless truths at the heart of our philosophy: as Calvin Coolidge famously argued, “If all men are created equal, that is final. If they are endowed with inalienable rights, that is final. If governments derive their just powers from the consent of the governed, that is final. No advance, no progress can be made beyond these propositions.” But the application of those propositions cannot be separated from the governed themselves, who remain a moving target. American conservatism cannot be separated from America, or from American conservatives.

Part of Dan’s philosophical case for RonD being an acceptable GOP presidential nominee deals with vaccines:

David also argues that DeSantis is “more anti-left than conservative in the classic sense” as illustrated by “flip-flops” on Ukraine and vaccines. But to start with, being pro-vaccine or anti-vaccine, in general or in any specific case, is not a question of conservative principle, but a pragmatic question. There are two general conservative principles involved in vaccination debates: Individual liberty argues against vaccine mandates, while public order argues that government must sometimes have the power to control epidemics. But there is no neat ideological formula for balancing those two principles.

A more broad example from Dan is here:

In the history of American politics, there has never been a perfectly pure classically liberal conservative: not Coolidge, not Abraham Lincoln, not Ronald Reagan, not William F. Buckley Jr. or Barry Goldwater, not Madison, George Washington, John Adams, or Alexander Hamilton. All had their flaws, and all deviated at times from our ideals. 

Absolutely. We find Dan convincing but it is not the primary argument that we would make. We think of ourselves as practical and the practical matters. The purpose of political parties is to create coalitions, win elections, and provide something for those coalitions so they can win future elections. The classically liberal American conservative (CLAC) that Dan references is a small group. Dan’s link shows that folks are trying get the cachet of conservatism without really being conservative. We CLACs are small in number but we have a good brand that has had an influence on politics far beyond our numbers for most of our lifetime. Even Democrats like Truman, Kennedy, Carter, and Clinton had something for the CLACs.

We have voted every time we were eligible and for almost every place on the ballot. That might be a thousand votes as there are numerous opportunities to vote for four or five of these in local elections as well as primaries and general elections. Of all of those votes there are only three that we are really happy with: Reagan in 1984 and Ron Johnson twice. It is an astonishingly low rate of return for our work and interest in politics.

CLACs try to influence parties and candidates in a conservative direction. If they choose to vote,

Sidebar: We would argue it is economically conservative to not vote but culturally conservative to vote. Economically, it is not worth the time and danger, however small, to vote. Culturally, it is a virtue to vote. End sidebar.

then conservatives vote for candidates with conservative priorities. If we are lucky, we will get a handful of candidates that match our priorities in our lifetime. So we see it as a practical choice. A CLAC, or any other member of a splinter group is rarely going to get what he wants. Each CLAC needs to decide how little they will take for their support and vote. Unless David changes his mind he is unlikely to vote for president ever again.

An Entitlement Example

The current Debt Ceiling Dust-up (DCD) is instructive in understanding the serious financial problems of our federal government. The DCD manages to be intense, dishonest, and small potatoes in the oncoming fiscal crunch. You will have to look it up on your own if you missed the rhetorical fireworks. No, it is not about default. No, the president can’t unilaterally ignore the debt ceiling. Yes, the Congress (with the President’s approval) can change laws. Yes, both sides will have to accept some things they don’t like.

After the DCD is over, the campaigns for office and especially president will begin in earnest. The last four winners of presidential elections (44th, 44th, The Donald, The Frontrunner) have all promised to ignore America’s most pressing problem, entitlements. It is a bit of a surprise that such a varied group of liars have all kept that one promise.

Sidebar: Do either the Democrats or the GOP have a real plan for Social Security? If we mean the GOP led by The Donald then our answer is no, they don’t have a plan. As we see it, at least some of the Democrats have a plan. By waiting until Social Security is on the verge of destruction they can “save” it with a huge tax increase. Because they waited so long the only way to “save” Social Security leads to a massive surplus some years later that they can spend at their leisure. End Sidebar.

As always, we start with Social Security. Why? It is easier because there are less moving parts than Medicare. One of the proposals at The Reformer is to change the cost of living adjustment (COLA) and base it on Chained CPI:

Chain-weighted CPI can capture both general changes in spending, as consumer preferences change, and substitution effects, when relative prices change. The adjustments in chain-weighted CPI make it a better measure of the cost of living, but a less accurate measure of inflation.

The “regular” Consumer Price Index (CPI) doesn’t adjust for the fact that (almost) nobody is buying DVD players anymore. Chained CPI would result in lower COLAs. So chained CPI seems like a much fairer solution in the battle between tax payer and tax receiver. Other folks, particularly the Senior Citizens League and Vance Cariaga, disagree. They argue that seniors purchasing is not consistent with the CPI so seniors need more not less to maintain purchasing power:

A study released earlier this month by The Senior Citizens League, a non-partisan seniors advocacy group, found that the nation’s oldest adults who retired before 2000 have lost 36% of their buying power since the turn of the century because COLAs have not kept pace with inflation. These retirees would need an extra $516.70 per month ($6,200 in 2023) to maintain the same level of buying power as in 2000. [Emphasis added]

We are not convinced but the data needs to be seriously investigated. MWG doesn’t have the resources but Congress does. We are not convinced because of the first quote on chained CPI, Vance’s misleading non-partisan, and the specific date. The first quote suggests that chained CPI is better for COLA. The non-partisan is misleading because this is not a Democrat versus GOP issue. It is seniors versus everyone else and The Senior Citizens League is highly likely to be partisan for … seniors. We always have trepidation when somebody draws attention to a specific time sequence. Usually, it is not a representative sample.

It is possible, however, that seniors have different spending habits than reflected in the CPI or chained CPI. It and means testing are two of the many potential changes in Social Security that are worth serious investigation. We should have started on this some time ago but January 2025 is now the likely earliest start date. We need hearings, debate, and compromise rather than adopting the MWG proposal on a partisan basis and saying we are done with it. If, however, you prefer the MWG proposal send us a check for a very (!) large amount and we will consider it.

Defending With Three Trump To The Ace

As we said last time, we have just returned from a bridge tournament, Gopher Regional Bridge Tournament. It was a well run tournament with excellent players. We had a good time and ended up with about an equal number of scars and scores.

Larger tournaments like regionals have various strata so you end up with opponents that are comparable or better than you. Opponents in the open category where we play don’t make many mistakes. Here is one that you shouldn’t make either. As a general rule, when you hold three of opponents trumps and one is the ace you should win the second round of trumps and lead the third trump. If you are a novice bridge player just do it every time and you will almost always be right unless your partner has played the king in front of you.

The only times you might consider not taking the ace or playing the third trump is if opponents have less than eight trump, a rare happenstance, or if the dummy has only two. The first reason to play the ace on the second round of trump and then lead third trump is that in the usual distributions of trump (5-3, 4-4. 5-4) you are taking out two of opponent’s winners at a possible cost of one of your winners. The second reason to do it is that it gives you a safe escape from your hand. The latter reason was the problem for our opponents.

We were in four hearts after we had opened one No Trump. Partner had transferred us to hearts and we wisely chose four hearts over three NT because we had four to go with partner’s five. The opening lead was the ace of spades followed by a little one. Dummy had the queen and ten of spades (played on the first trick), four hearts, three clubs to the queen, and king, queen, little for diamonds. Combined with our holdings there were four possible losers, the ace of spades (already lost), the ace of hearts, and two clubs. Because our combined clubs were ace, queen, 9, x, x, x, x we wanted opponents to lead the suit. We won the second trick with the queen of spades on the board and led the queen of trump which held. Then we led a small trump from the board and right hand opponent failed to go up with the ace. We won in our hand with the king and left-hand opponent showed out. Hurray! We cashed the king of spades discarding a club from the board and the top three diamonds discarding a club from the hand. Then we lead a little heart and RHO was forced to win with the ace and either had to set up the queen of clubs or give us a ruff and a discard. He chose the latter because he had the king of clubs and we ruffed in the hand, discarded a club in the dummy and claimed making five. We can’t find the score but it had to be very close to a top. We might have guessed clubs and made four but we should never make five. If RHO had gone up with the ace on the second trump we would have had problems.

Of course, LHO didn’t help his partner much with the opening lead of the ace of spades.

Presidential Nominees And The Debt Ceiling

We are back from a bridge tournament. We have a bridge lesson, one of our few bright spots, but we start with opining on the two questions we see over and over again in our travels. First, who should be the nominees for president in 2024? Our opinion is somebody new. In our definition of new we include all the immediate family and spouses of former presidents and presidential nominees. No to Laura, Michelle, Donald Junior, Hunter, and all the rest. Even Mitt.

A related question: should there be more than two serious presidential nominees? If neither the Democrat or the GOP nominee is new then yes, we need a third nominee. If one of them is new then we will wait until those choices are made.

The second question is what to do about the threatened partial government shut down, that is sometimes referred to as the Debt Ceiling Showdown or incorrectly at the Debt Default Crisis. The GOP is trying to get some small concessions from the Democrats to make the financial position of the federal government less perilous. It is an excellent idea and we hope the GOP will succeed but even if they get everything they want the federal government is still on a fiscal path that cannot be sustained.

We have two points about the government shutdown negotiations: First, the GOP should declare victory when our president, The Frontrunner, offers a deal and vow to fight for fiscal sanity. We’d really like to see the GOP really fight for fiscal sanity because it seems very unlikely that the Democrats will. If the GOP holds out for Conan the Barbarian victory then fiscal sanity will suffer a set back. We need our political representatives in DC to do politics. Second, the GOP, the Democrats, or a third party are going to need to fix the financial position of the federal government soon. A reasonable guess is they have two presidential terms to get serious. A big part of the fix mix will be entitlements. More on entitlements soon.

We support somebody new for both presidential nominees in 2024 and the GOP in the current dust-up over spending.

Eric Clapton: Across 24 Nights

We dusted off our Clapton 2006-7 North American Tour t-shirt and the Lady de Gloves was outfitted in her Clapton-Winwood shirt from a few years later and we went to see Eric Clapton: Across 24 Nights (24) at the local theatre. It was excellent, surprisingly excellent as the Lady put it. Why was the excellence a surprise? Because music documentaries are often talk, talk, talk. Talk about things long past where the subject’s drug use makes us wonder about what really happened. Often the video doesn’t have the detail you want and spends too much time watching the crowd. Instead, 24 is just great concert footage lovingly reconstructed and well organized that shows what actually happened on stage. 24 is what you would see if you were up close to the stage and nobody was in your way. If you have ever been to an Eric concert you know he isn’t big on patter. About all you hear from Eric is, “Thank You!” And when he gets really wordy, “Thank You! Thank You Very Much!” He lets his music speak and 24 does too.

24 uses footage from 24 nights of Eric concerts during 1990 and 1991 at the Royal Albert Hall in London. One of the reasons we went is we saw the Concert for George in that venue just over twenty years ago. During 24 nights, Eric had very different concerts including a small four-piece band with Phil Collins on drums, a larger (we think) fourteen-piece band, a blues review including Buddy Guy, and being backed by an orchestra. The show starts and finishes with the orchestra and the rest of the versions are spread around as Eric performs seventeen (again we think) of his hits in concert. The footage is great. We see close-ups and cut aways to all the individuals. The directing, cutting, and original footage are all impressive. We don’t know why they waited thirty years to make 24. If you are an Eric fan you must see him at the height of his powers. If you are a music fan you should see it.

Another Tale Of Two Parties

Recently we were writing about the cities and the opportunity for the GOP. Matt Paprocki, writing at NRO, calls for conservatives and others to stay in the Democrat cities and work for change:

But reasonable and moderate elected leaders can only do so much. It takes residents willing to fight for change in their hometowns to bring it about. While no one can be faulted for moving out of a city for financial reasons or out of fear for their family’s safety, our great American cities will only improve if Americans are willing to stay and fight for their futures.

Matt backs up his rhetoric by buying a house in Chicago. What we found most interesting is that the GOP gets no mention from Matt. The problems in cities like Chicago include safety, school choice, and prosperity and those should be right in the GOP’s wheelhouse. We see Matt’s acceptance of Democrat cities as part of the problem with our politics. Both parties wait to see who is the candidate rather than seeking out candidates that bring the party brand. That brings us to Sarah Isgur at The Dispatch who tells us the party narratives are getting locked in. We think candidate narratives would be a better description but otherwise we are with her. Talking about our current president, The Frontrunner, and our former president, The Donald, she says:

And there’s something jarring I’ve noticed in the past couple weeks: the hardcore [The Frontrunner] voters and the hardcore [The Donald] voters aren’t just confident their guy is going to win, they don’t see how it could possibly come out the other way. 

Really, there are hardcore voters for The Frontrunner? But seriously, what do we know with a couple hundred days until primary voting starts and a couple hundred more until voting for the general election starts?

We know that in the last three presidential elections that the federal government has tried to give the Democrat a helping hand. In 2012 it was the IRS. In 2016 it was the FBI and others in Russia hoax. In 2020 it was the letter from the spooks trying to negate the impact of Hunter Biden’s laptop. The government with a thumb on the scale is much more worrying than the problems we have with various media outlets. What will happen in 2024? One of the many problems caused by this series of unfortunate events is that if a GOP candidate cries wolf, it will be hard not to be sympathetic. And, of course, we won’t know the true state of affairs until long after the election.

Then there are the primary voters. The GOP voters have given us McCain, Mitt, The Donald, and The Donald and the Democrats have given us the 44th president, the 44th president, Herself, and The Frontrunner in the last four tries. There is not much for either party to be proud of. Given the government thumb on the scale and the quality of GOP candidates, the Democrats can’t have much pride at winning three out of four. The Frontrunner is the clear frontrunner for the Democrat nomination although a WSJ post (paywall alert) recommended the wife of the 44th president because none of the people in the current administration are acceptable. We don’t think this is satire:

Mrs. Obama is popular within the Democratic Party. She left the White House with a 68% favorability rating nationally and was one of the most admired women in the U.S. from 2018 through 2020, according to Gallup polls. With a broad network of supporters and the ability to resurrect Barack Obama’s political organization, she would be the strongest candidate by far.

It is the state of the Democrat party. The state of the GOP is equally unsettling. The GOP has co-leaders for the presidential nomination in The Donald and RonD. The former seems to be a sure loser and the latter seems to be of a similar thin skinned nature who has not distanced himself from The Donald. Buckle up voters. It looks to be a turbulent ride to November 2024.

A Tale of Two Parties And Many Cities

The NY Post has posts by Kevin D. Williamson and Glenn Harlan Reynolds (InstaPundit) that the GOP and perhaps the Democrats ought to read every day for the next year. You should read them all as well. There isn’t even a paywall. Our conclusion is that the GOP have, so far, missed a great opportunity by sitting out mayoral races.

Kevin asks why unopposed mayoral races are bad for Democrats. First off, he lists numerous cities where the mayoral races don’t include a member of the GOP. Some are unopposed and some have two or more Democrats. Kevin’s first conclusion is:

It’s clear that urban voters do not want what [the GOP is] selling; it’s just as clear that what Democrats are selling has failed them.

Agree. His second conclusion is [paragraph break eliminated]:

Urbanites need real political choices in order to pursue intelligent reforms — and cities need real political competition to create incentives for policy innovation. That competition does not necessarily have to come from the GOP, but it has to come from somewhere. 

Agree. Kevin identifies a number of failings of the Democrats in cities but Glenn adds a racial perspective with the title: Democrats Throwing Blacks Under The Bus For New Progressive Agenda. He starts with the reaction of blacks from the South Side of Chicago to the importation of hundreds of illegal immigrants from Central America. They are not happy. A newspaper accused them of sounding like an America First rally for The Donald. Glenn asserts [paragraph breaks deleted]:

For basically my entire lifetime, Democrats have courted the black vote and promoted black issues. But in the last few years, that’s changed. The Democratic Party is now run by well-off, mostly white, woke people whose interests diverge rather sharply from those of the party’s erstwhile black constituents. Black voters want jobs. Democrats want to import illegal-immigrant competition that will drive wages down and make those jobs harder to get. Blacks want safe streets. Woke ideologues (who generally live somewhere else) push de-policing initiatives that increase urban crime and disorder while killing off businesses that provide employment, something that’s happening in Chicago, New York, San Francisco and elsewhere. [Emphasis added]

We bolded the wants because we’re not willing to speak for black folks because, like every demographic grouping, they are not uniform. On the other set of wants, we are in agreement with Glenn on what the Democrats and their woke supporters want. We bolded erstwhile because we don’t agree with Glenn. That is his hope rather than the fact at the current time. Glenn goes on to say [paragraph break deleted]:

The truth is the Democratic Party is no longer the party of the working class and the poor. It’s the party of well-off woke white people and the billionaires who fund their nonprofits and control their corporate employers.

Glenn’s website often comments: harsh but true. That is surely the case for the former but we have some questions about the latter. His description of the GOP is kind but equally questionable:

The GOP is now the multiracial party representing the interests of working-class Americans of all extractions.

One example of the GOP’s failure to represent all working-class Americans would be as most working-class Americans are paying tariffs and neither the GOP nor the Democrats are representing them.

We think the GOP is missing a big opportunity to make inroads with demographic groups, develop talent, and serve America because it fails to put an effort into recruiting folks to run in mayoral races. The GOP and the talent they recruit would need to make the decisions but we think three traditional GOP positions would resonate with a substantial number of city folks: school choice, supporting the gig economy, and stopping illegal immigration. We brought up the tariff issue earlier but cities don’t have tariffs so it can’t be much of an issue in a mayoral campaign.

We know from the 2016 and 2020 presidential races that competition does not ensure candidate quality. Competition, however, is the most likely way to create candidate and idea quality even if the probability is not one-hundred percent. Competition in mayoral races provides a chance to fix the cities, the Democrat party, and the GOP. The problem is we know which party is the stupid party and they probably won’t change.

Not The Worst Social Security Plan

As we said in our last post, Bill Cassidy, a GOP Senator from Louisiana, has taken our current president (The Frontrunner) and our immediate past president (The Donald) to task at NRO for having no plan for Social Security other than letting it go insolvent and reducing payouts across the board. Here is some of what he said:

Except their [The Frontrunner and The Donald] plan is to do nothing. Under their “Do-Nothing” plan, Social Security will be insolvent in nine years. As required by law, solvency must be restored by benefit cuts, in this case, of 24 percent. These dramatic cuts will double poverty among the elderly. Alternatively, Congress could increase the payroll tax as much as 27 percent — which is highly regressive and punishes poorer people — to avoid this outcome.

Bill is exactly right that the Do-Nothing plan is a terrible one. We suspect that the real plan of The Frontrunner and the Democrats is to force a huge tax increase sometime as we get closer to insolvency. As we have discussed previously, such late action will likely end in excessive taxes in the future and lots of spending and control opportunities for future Democrats.

Today we want to discuss Bill’s plan. It is better than the Do-Nothing plan but we are not fans. Bill and his bipartisan group:

[P]ropose placing $1.5 trillion over five years in a diversified investment fund separate from the Social Security Trust Fund. The investment would be held in escrow for 70 years to take advantage of compounding. Under this plan, the 24 percent benefit cuts are eliminated and 75 percent of the Social Security shortfall is covered. This model presumes a greater rate of return from investments than the cost of borrowing, which has been true since at least 1929. [Emphasis added]

Did he mean reduced rather than eliminated we have put in bold? The he goes on to say:

Where political leadership is needed, however, is in covering the remaining 25 percent of the shortfall that our plan does not account for. Seniors and those close to retirement should not pay higher taxes or see benefits decrease, of course. 

We love Bill patting himself on the back for political leadership by saying we have taken care of 75 percent but we need political leadership, from somebody else it appears, to cover the last 25 percent. We have three comments: First we want to see the math on how $1.5 trillion will eliminate 75 percent of the Social Security shortfall. What is the expected rate of return? Bill mentions 8.9 percent on another investment. That seems way too high. Unless he has cuts he hasn’t mentioned, the government will have to borrow another trillion and a half. Has he factored in the cost of borrowing? Does he intend to pay it back?

Second, there is a warning on investment advice that goes something like past performance is no assurance of future results. There is an obvious risk because investment returns are uncertain. Take a look at the 100 year DJIA historical chart. It looks good over 100 years but there are some long periods of weak performance. There is an inflation adjustment button that we would suggest you turn off so you can look in nominal terms. From about 1965 to 1982 the DJIA did not increase. It also took 25 years to recover from the stock market crash of 1929. Social Security goes insolvent in nine or so years and the passage of Bill’s bill is not imminent so long periods of low returns need to be a big concern.

Sidebar: We wish that Bill’s bipartisan bill would mean that there is bipartisan support for economic growth. Bipartisan support for economic growth would make sense because it would increase the probability of the bill being a partial solution to the problem. Unfortunately, the two parties have priorities and economic growth is not one of them. End Sidebar.

It is difficult to predict such things but with both parties avowing to throw spanners in the economic works, it is easy to see a rerun of the LBJ and Nixon era when the stock market stalled for sixteen years. Of course, the US economy as reflected by stock market averages has resisted the efforts of the last three presidents so it is amazingly resilient but at some point it will need less “help” from the government.

Third, we are not in agreement with Bill’s last sentence. We think current seniors and near seniors should bear some of the burden of cuts and taxes. For example, means testing and inflation adjustments should hit MWG as well as younger folks.

Bill’s plan is better than the current plan of insolvency and chaos. We need, however, more certain solutions for the 66 million people currently receiving Social Security. Perhaps Bill’s idea can be part of those solutions.