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Alan Simpson Stops to Answer Questions From Uninformed Liberal, Left Cries: “How Rude”

First, here’s the video of Simpson’s Confrontation with Social Security Works’ Alex Lawson.

Now, the Left’s interpretation:

RJ Eskow, also of Social Security Works, writes:

A video of retired Sen. Alan Simpson’s foulmouthed rant toward activist Alex Lawson is making the Internet rounds, as well it should: The sheer audacity and rudeness of the guy makes this clip “must-see TV.” It’s a political bloopers reel.

I think Eskow got the roles backwards here.  Simpson is trying to answer the “ambush journalist’s” questions, but interviewer Alex Lawson keeps interjecting irrelevant, Left-Wing talking points like claiming the Social Security Trust fund has been raided to pay for “two wars and tax cuts for the rich.”  Did Simpson curse?  Yes, but at least he was calling bullshit by its proper name instead of mindlessly shouting down the opposition.  I guess Simpson could have taken the Left-Wing approved tactic of smacking his camera away and shouting “who are you?” repeatedly.

But, while Simpson’s outrageousness makes the video entertaining, here’s what make it important: Alan Simpson is one of two chairs of a bipartisan commission created by President Obama to study the Federal deficit. His comments reveal a number of very important things about his biases, his tendency to distort and mislead, and his ideological extremism. These traits are likely to taint the Commission’s work – work which has great implications for the future.

Your future.

This demonstrates the Left’s biggest problem: to Liberals, reality represents “biases,” distortion, and “ideological extremism.”  Fact: Social Security was sold as a type of “emergency savings;” people were misled to believe you paid into the system, and then the money was saved until you withdrew it.  Fact: Government raided the trust fund.  Fact: Government doesn’t have the money to pay back the IOU’s.  Fact: Even if Government did have the money, Social Security would still be insolvent because it’s paying out more than it collects.  Conclusion: In it’s current form, Social Security will eventually collapse.  Lawson and Eskow’s conclusion: Simpson’s numbers are wrong.

Read my lips: We’re cutting your benefits so that we don’t have to pay new taxes!

Here’s the bottom line. Simpson doesn’t want to force the government to pay those bonds back, because it will probably require new taxes to pay for them. The Commission’s likely to recommend some new taxes, but the Simpson crowd wants those increases to be a small as possible.

There’s only one problem with Eskow’s theory: tax increases won’t increase the total revenue to the Federal Government.  And they will probably decrease revenue.  After the Reagan slashed marginal rates, “individual income tax revenues rose from $244 billion in 1980 to $446 billion in 1989.”  As Kurt Hauser, a San Francisco economist, discovered: regardless of tax rate, “the federal tax “yield” (revenues divided by GDP) has remained close to 19.5%.” In other words, the key to increasing revenues is increasing GDP.  High tax rates—the favored “solution” of the left—suppress GDP.

Hauser's Law

Further, lowering tax rates “can increase the amount and share of tax payments generated by the rich.”  Thus, when the Left raises rates, they’re actually shifting the burden away from the rich onto the middle class.  Ironically, if Hillary Clinton is right and “the rich aren’t paying their fair share,” then their rates need to be lowered. Facts are stubborn things.

We didn’t cut your benefits! Now be quiet and eat your cat food!

SIMPSON: In the year 2037, instead of getting 100% of your check, you are going to get about 75% of your check. That’s if you touch nothing. If you like that, fine. You’ll be picking with the chickens yourself when you’re 65.

….

LAWSON: Thanks for being so frank. My question is: raising the retirement age, is actually an across-the-board benefit cut?

SIMPSON: There are 15 different options being discussed in here today, and why nail one of them…[inaudible]…if you would like to get one of them that pisses your people off.

LAWSON: Alice Rivlin was just on CNBC saying that that was one of the favorite methods.

SIMPSON: There are 15 of them in there.

I like the folksy “cutting with the chickens” line (although I don’t know what the hell it means.) But this is the thinking: “we’re not cutting , we’re stabilizing.” Expect to hear the word “stabilizing” used to mean “cutting” many times in the month to come – and expect your Social Security to be “stabilized” when it’s time for you to retire if this ideology prevails.

Eskow totally misses the point here.  The panel has taken no action, and while moving the retirement age might be considered a cut, it hasn’t happened and there’s no guarantee it will happen.  As Simpson rightly points out, Lawson chose the one option out of fifteen that most enrages his audience, and acted as if it were the panel’s recommendation.  Finally, raising the retirement age wouldn’t affect those who are already drawing a check.  And knowing how government usually works, it would probably be phased in very slowly.  In other words, raising the age requirement would affect young people, not old people, and we would have plenty of time to plan for that change.

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