October 10, 2007

Are We Going to HillaryFare?

Hatched by Dafydd

Sen. Hillary Clinton (D-Carpetbag, 95%) was roundly mocked for her "Hillsbury Doughboy" proposal, which she made before a forum hosted by the Congressional Black Caucus, to dig down deep into other people's pockets to send $5,000 to every newborn in America. So she dumped it as casually as she threw Billy Dale under the bus. What are black voters going to do -- vote Republican?

Now she has a new scheme to lurch America further along towards Socialism: She wants the federal government to pay $1,000 in "matching funds" every year to every (low-income) American who puts $1,000 in a fake, government-run "401K". What a wonderful, new way to create yet another government piggy bank -- in addition to Social Security -- that the liberals can loot whenever they run short!

(Nota bene: That's $1,000 matching funds to lower-income investors only -- under 60 Gs; higher-income investors, 60 to 100 grand, only get $500 per year in matching funds. $100 thou a year, and you're SOL.)

The tens of billions of dollars to fund this scheme would come from heavily taxing "large" estates. So let's think this through: We kill the rich and feed them to the poor, forcing middle-income people to liquidate family farms and family businesses, so that we can redistribute that (clearly unearned) wealth to the poor. Sounds familiar, somehow...

Let's call Hillary's new welfare program "HillaryFare" for short.

Of course, it likely wouldn't pass Congress; but that's not the point, is it? It serves to burnish Hillary's credentials with the all-important MoveOn.org, George Soros, "two Americas" crowd, thus further crippling the anemic campaign of the Silky Pony, John Edwards, and causing Sen. Barack Obama (D-IL, 95%) to become even more tongue-tied in debates:

While many Democrats would embrace an estate tax freeze, many Republicans and antitax stalwarts would oppose it, and Democrats would probably have a hard time passing such legislation in the United States Senate, where the party’s majority is currently razor-thin.

But suppose enough Democrats are elected that President Hillary is able to get this thing passed as she proposes it. Has anybody bothered to run the numbers, here?

Hillary boldly estimates that the whole pyramid scheme would only cost "$20 billion to $25 billion a year." Let's assume that half the "investors" in this government numbers racket fall in the under sixty thousand category, while the rest are between sixty and a hundred. Then the average per capita payment by the federal government is $750 per year; the total cost, allowing for about 40% in overhead costs (which is typical of government programs), would be $1,250 per person, per year.

The $20 billion to $25 billion that Hillary proposes for this, er, idea would cover only 16 to 20 million people (the way the Times writes it, it appears to be open to every person, not every family).

So what if instead, after a year or two, we have 40 million families taking advantage of the government's largess? It shouldn't be that tough to get 13% of the population to go for it; heck, even higher-income earners wouldn't sneeze at a guaranteed 50% return on investment. I would take it!

All right; with 40 million fake investors, now the cost is up to $30 billion of actual matching funds, which works out to $50 billion per year in total costs to the government. That's a lot of samoyans. But in fact, Hillary is far more grandiose -- though she keeps this part of the mathematics pretty close to her vest. Viz:

“We’ve got a lot of workers -- more than half in America right now -- without any employer-based retirement system,” she added, noting that the number included about 770,000 workers in Iowa.

Half of all workers in America: According to the Bureau of Labor Statistics household data, "total employment" in the United States is currently 146.3 million (page 2, table A). So if half of those don't have an "employer-based retirement system," and those are the targets of HillaryFare -- then is she really planning on sending those $500 and $1,000 matching-fund checks to 73.15 million people every year?

That's $55 billion dollars a year just in matching funds; add in the overhead, and you get an annual price tag of over $90 billion each and every year.

But wait -- just like the Ginsu knives, there's more! Of course, the investment ceiling of the program would have to have its own growth curve; in ten years, $1,000 won't be worth what it is today. If Social Security and welfare programs are any indicator, that growth curve will be significantly steeper than the inflation index. So how long before HillaryCare is costing us $100 billion, $130 billion, even $180 billion per year in a new middle-class entitlement program?

So in addition to HillaryCare II -- where 25 year old children whose families make up to $80 thousand a year get government-run health-care plans -- the good senator more or less from New York also promises to put half the whole country on the government welfare rolls.

But all is not lost. Having learnt her lesson from the 1994 HillaryCare I debacle, Sen. Clinton now supports individual choice:

As with her biggest policy plan for universal health insurance, Mrs. Clinton cast her savings proposal in terms of choice: If Americans like their 401(k) plans and other retirement accounts, they can keep those, while those who lack any savings plan will have a chance to start one with government help and save $5,000 a year on a tax-deferred basis.

In other words, those who like HillaryFare better than their own retirement accoutns will be lured from private to public funding... just the way the new Democratic S-CHP proposal lures millions of families from private medical insurance for their kids to government-run health care. So it's not just the 73.15 million people above; we may well be paying matching funds to a bunch of people who currently do have an employer-based retirement system!

Can we go back to the $5,000 baby bounty instead?

You know, the way Hillary Rodham Clinton Rodham is going, I fully expect that by this time next year... she'll be offering to buy our children at birth and raise them in liberal incubators.

Sen. Clinton has a simple philosophy about our golden years:

“Saving in the accounts will be easy -- it should not require a Ph.D. to save for retirement,” Mrs. Clinton said.

She's right, it doesn't take a Ph.D. It takes a village idiot.

Hatched by Dafydd on this day, October 10, 2007, at the time of 3:18 AM

Trackback Pings

TrackBack URL for this hissing: http://biglizards.net/mt3.36/earendiltrack.cgi/2487


The following hissed in response by: Rovin

Anti-capitalist socialist vs. a free market economy---where ideologys collide

We already have a government sponsored 401k retirement program. It's called Social Security, and it has not been solvent for years. If the democrats want the people of this nation to mimic the socialist policies of communist Russia a generation ago where dependency on the government failed, why don't they just come out and say it.

This nation was founded on independence and self-reliance of the individual and the framers saw how important it was to limit government intrusion. Every time we accept a new government "entitlement" we shackle and bind the next generation to a government controlled dependency. This is all about POWER AND CONTROL of our hard earned dollars to re-introduce the welfare state of the Carter administration that thought it was easier to feed the lazy who found it was more convenient to rely on the government than to get off their ass's and go to work every day.

This is the cruel and harsh reality of the programs that the new Mrs. Bill Clinton intends to craft for the sake of the "needy". The tax relief programs that Reagan and Bush introduced is what has provided real growth for this nation by putting the money back into the hands of the individual. The democrats believe it's their money to re-distribute as they see fit.

The above hissed in response by: Rovin [TypeKey Profile Page] at October 10, 2007 7:31 AM

The following hissed in response by: Fritz

Dafydd, you should have mentioned the revenues derived from estate taxes. A casual search shows that from 2002 through 2005 the estate tax generated approximately 21 billion dollars per year and I was too lazy to try to find later numbers. Anyhow, if we use your figures it appears that the estate taxes would have to be dramatically increased in order to pay for her program. That would mean increasing them beyond what is scheduled for 2011 when they revert to 2001 laws and rates. The data I found said that the revenue would have been doubled in 2005 had the 2001 laws not been in effect and that only brings it up to 42 billion, still far short of the 90 billion you calculate is needed.

Even if we use the figures suggested by some in favor of retaining the estate tax, the revenue still falls short. Those numbers are approximately 777 billion from 2011 through 2021 which figures out to approximately 78 billion per year and that is still short of the 90 billion needed at the beginning. When they adjust the amount of matching funds for inflation, it will be even worse. So no matter what, her source of revenue will not begin to pay for her program without some pretty big hikes in the estate tax. And, as I recall, the reason for the current law is too many people were complaining as inflation has put more and more estates into the bracket of having to pay estate tax on them, and I doubt that ten years inflation will make the problem go away when the current law expires. Part of the reason the current law was passed was to keep the family farm or business from having to be sold, and I'm not at all convinced that the family farm or business is now worth less so that the tax would no longer affect them.

The above hissed in response by: Fritz [TypeKey Profile Page] at October 10, 2007 7:54 AM

The following hissed in response by: Rovin

By Fritz's numbers this is hardly a "pay as you go" policy the dems promised in the '06 elections, but who's surprised?

By the way Dafydd was that a little Simon and Garfunkel in your title? "Are We Going to HillaryFare?"

The above hissed in response by: Rovin [TypeKey Profile Page] at October 10, 2007 1:56 PM

The following hissed in response by: Dafydd ab Hugh


By the way Dafydd was that a little Simon and Garfunkel in your title? "Are We Going to HillaryFare?"

Well... in a sense; Simon and Garfunkle were one of many thousands of acts who have recorded that traditional song. (Their original contribution was a second song, which Paul Simon wrote and which became part II of a round with "Scarborough Fair.")


The above hissed in response by: Dafydd ab Hugh [TypeKey Profile Page] at October 10, 2007 3:24 PM

The following hissed in response by: Mr. Michael

We kill the rich and feed them to the poor, forcing middle-income people to liquidate family farms and family businesses, so that we can redistribute that (clearly unearned) wealth to the poor. Sounds familiar, somehow...

No, wait, that was killing the old to feed the young. My bad. This is NOT a class warfare Soylent Green. Really. Silly idea, don't know where it came from.

The above hissed in response by: Mr. Michael [TypeKey Profile Page] at October 10, 2007 11:58 PM

The following hissed in response by: Terrye

I was surprised to hear Charles Krauthammer call this program innocuous. He did not say it was a good idea, but he did not think it was all that bad, because it required personal savings on the part of working people.

I paraphrase here, so if I misunderstood Mr. Krauthammer I have no one but myself to blame.

The above hissed in response by: Terrye [TypeKey Profile Page] at October 11, 2007 4:13 AM

The following hissed in response by: Robin Sizemore

Didn't the Republicans propose a very similar system (minus the government match) a few years ago, only to have Democrats throw a hissy fit about how it would never work?

Granted, they were trying to transform the *existing Social Security* into a government-held retirement account, but it still seems VERY similar (again, without the match) to the plan that, not long ago, Democrats decried as too risky.

The above hissed in response by: Robin Sizemore [TypeKey Profile Page] at October 11, 2007 7:14 AM

The following hissed in response by: cdquarles


Ding, Ding, Ding, Ding. You've won the prize!

Oh yeah,

Hildebeest, please tell me where the money would go? I think I'll answer my own question. Treasury Bonds and other government debt. IOW the most risky kind of bond precisely because you think it is safe, since you think that the default risk will be low. That's true today for the Treasuries and most State bonds, but will it be true 30 years from now? Most government have defaulted on their debts at some point, even the US government did so shortly after its founding.

The above hissed in response by: cdquarles [TypeKey Profile Page] at October 13, 2007 8:47 AM

Post a comment

Thanks for hissing in, . Now you can slither in with a comment, o wise. (sign out)

(If you haven't hissed a comment here before, you may need to be approved by the site owner before your comment will appear. Until then, it won't appear on the entry. Hang loose; don't shed your skin!)

Remember me unto the end of days?

© 2005-2009 by Dafydd ab Hugh - All Rights Reserved