‘Honey, I’m home.”
“Hey, Sweetie!! How was your day?”
“Great. Best ever! I got a 20 percent pay cut.”
“That’s good?”
“Absolutely! The best thing that could happen to us.”
“How?”
“It will create more jobs. Maybe the kids can find work.”
“Huh?”
“Plus, we get to pay more for health care and for our home and for the kids’ college educations.”
“Did I miss something?”
“No. That’s trickle-down economics. You see, since our tax rates are going down, we probably won’t be able to deduct our mortgage interest and we may have to pay tax on health insurance. Plus we get to pay higher interest rates on the kids’ student loans.”
“So, we make less, pay more, and that’s better?”
“Yes. Now more people can compete for our jobs. If they have a profit motive, they won’t waste as much and we’re all better off.”
“But how do we make ends meet if we earn less?”
“We cut our wasteful spending.”
“Like what?”
“We’ll look at our budget. We can do it.”
“How?”
“We’ll figure that out after my pay cut. We must stop spending more than we earn.”
“But we do. We borrowed money to buy our house and our cars. We already spend more than we earn.”
“Debt is bad.”
“Isn’t that debt?”
“It sure is, but we must stop. If our kids start saving now, they can pay cash when they buy their houses and cars.”
“That’s ridiculous.”
“Honey, we are just like the U.S. budget. The U.S. now owes $16 trillion with annual income of almost $20 trillion. That’s 80 percent.”
“But, Sweetie, we earn $60,000 and have a mortgage of $100,000 and our car loan is $10,000. We owe a lot more than we earn each year.”
“Look, Honey, it’s different with the government.”
“Why?”
“The government promised to pay us a pension and most of our medical expenses after we retire. Over 3.5 million people are retiring every year. The government can’t afford that.”
“You mean Social Security and Medicare?”
“Yes, Honey.”
“But we paid for that, didn’t we?””Sort of. We’ll pay about $7,500 into Social Security and about $1,700 into Medicare for 40 years.”
“How much will we get back?”
“About $18,000 every year in Social Security for life – about 20 years. Health care right now costs about $9,000 for each of us.”
“Sweetie, I really appreciate how hard you work and don’t like all the taxes we pay, but this makes no sense to me. I’m not a CPA, but how can the government give us back so much more than we put in and balance its budget?”
“Honey, that’s the problem. President Obama has spent more than $250 billion on Social Security and Medicare this year than he did just four years when he came into office. That’s pure waste.”
“Weren’t those laws passed, like 50 or 80 years ago, Sweetie?”
“That doesn’t matter. It’s still his fault. He’s president.”
“But if those costs keep going up, don’t we need to raise taxes?”
“Heavens, no, Honey. Taxes are worse than debt.”
David Post lives in Salisbury.