Revisiting the Safety Net

Lane Kenworthy's post arguing that there's lots more stuff the social safety net should be covering is a useful corrective to what I wrote here.

So in response to Kenworthy and to several people who emailed, let me rephrase my point. Let's assume we don't undertake any major new programmatic commitments. We don't expand early childhood education, we don't send a higher proportion of kids to college, we don't do comprehensive wage insurance, we don't increase redistribution to the poor, we don't offer paid family leave, etc. Instead we simply try to avoid reductions in service levels for our existing commitments. Well what happens is that to avoid cuts we need need increases. That's because the share of the population that's elderly is rising and the cost of health care and education is rising as a share of GDP. Paying too much attention to political debates can tend to obscure this. The reality, however, is that Barack Obama's tax proposals don't raise enough revenue to pay for George W Bush's spending proposals over the long run. Evolving over time to Danish levels of taxation will be difficult, and yet it'll be necessary just to maintain our current programmatic commitments. I think the CBO sometimes obscures this by not publishing state/local versions of its famous "Medicare costs will bankrupt us" chart.

That's all to say, in other words, that while there are new things I would like to see the government undertake realistically a large portion of the revenue would have to be taken out of existing commitments. Our health care cost structure is famously higher than anyone's else, so it's not like this is impossible. But saying "let's cut Medicare to pay for universal preschool" is, I think, a different sentiment from "let's expand the welfare state by creating a universal preschool program."