Author Topic: Feynman  (Read 1618 times)

Beasho

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Feynman
« on: October 25, 2016, 06:59:24 AM »
Another post got me thinking WHY we spend 50% of on Healthcare and Social Security. 

I found this discussion of magnetism by Richard Feynman and realized that he does a great job of answering, not only the 50% question, BUT uses rubber bands to explain the attraction to Hillary.

https://www.youtube.com/watch?v=MO0r930Sn_8

ericmichaels

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Re: Feynman
« Reply #1 on: October 25, 2016, 08:22:06 AM »
Why is it that when you talk about SS "spending" you only discuss the outflows and never the inflows? The Net outflow is small and generally comes from the trust fund. Yes SS is the dreaded "income redistribution" and you can argue that is a bad thing but it is not the flat out spending that you imply. If we eliminated the SS "spending" then the SS tax would also be stopped and your net improvement in "spending" would be basically nothing.

Kind of like when Trump talks about the income of his businesses but only talks about Revenues but not expenses. http://fortune.com/2016/09/26/donald-trumps-questionable-personal-income-claims/

>>How is Social Security Financed?

Social Security is financed through a dedicated payroll tax. Employers and employees each pay 6.2 percent of wages up to the taxable maximum of $118,500 (in 2016), while the self-employed pay 12.4 percent.

In 2015, $795 billion (85 percent) of total Old-Age and Survivors Insurance and Disability Insurance income came from payroll taxes. The remainder was provided by interest earnings ($93 billion or 10 percent) and revenue from taxation of OASDI benefits ($32 billion or 3 percent), and $325 million in reimbursements from the General Fund of the Treasury - most resulting from the 2012 payroll tax legislation.


Health care is a massive spending problem. As long a drug companies, doctors, hospitals and insurance companies are allowed to raise prices at will, it will continue to worsen no matter if Obamacare exists or not.

The magnet point is a big stretch. You can do better. The simple fact is there is a major disconnect between people in this country. We have absolutely no clue why you would vote for Trump and you have no clue why we would vote for Hillary. And most people don't actually care to listen to find out.
The internet provides the "facts" for all sides to make their cases and no one cares to look beyond what they think they already "know". Sad.

The way I look at our Presidential choices is that I can stab myself in the heart or the leg. I am choosing the leg and hoping I don't hit an artery.


PonoBill

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Re: Feynman
« Reply #2 on: October 25, 2016, 10:45:50 AM »
Always a pleasure to listen to Richard Feynman, under any circumstance.

As part of writing my book on retirement, I studied social security fairly carefully. What I came up with is that it's a fine idea that can't work. The core problem is that people insist on living a lot longer than they were supposed to. It's fairly easy to fund a substantial part of retirement expenses with social security when the contribution to the pool is consistent with the number of people drawing from it over the expected timeframe, and the majority of retirement expenses come from pensions provided by large manufacturing firms. The manufacturing firms needed to get older people out of the jobs they could no longer do well, either because of physical limitations or dated skills. Pension savings plus social security was adequate when the retirement age is 65 and the average lifespan is 61.7 years (1935). Roughly 60 percent of the potential retirees died before retirement. Current average lifespan is 78.4 years in the US.  Slightly more than 70 percent of people live past 65.

Currently the average pay-in to social security is about 300K and the average payout is about $270K--so that sounds OK, but the population is aging rapidly and lifespan is increasing. Social security benefits might look pitiful to anyone trying to live on them, but they're headed upside-down, which is why economists say SS will run out of money.

Medicaide is MUCH worse. The ratio of pay in to expense is three to one. $60K in 180K out. Expect medicare charges to increase dramatically soon--Obamacare or not. And of course these entitlements will become more of a third rail as the population ages. People have a notion that they deserve these benefits because they paid into them, but in reality they didn't pay nearly enough, and eventually the entitlements need to become rational.

Obamacare is a stupid mess, reminiscent of the California utility decision to regulate electricity transmission while they deregulated generation. Blackouts and stunning electricity prices to the transmission companies were inevitable and pushed them to the edge of bankruptcy. We're seeing the same thing in healthcare. You can't regulate the requirement for health insurance without regulating the cost of providing it.
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SUPcheat

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Re: Feynman
« Reply #3 on: October 25, 2016, 11:33:31 AM »
Feynman is always pretty funny.  The reporter was goading him, and he basically wound up saying in a nice way that the reporter wasn't smart enough to understand the answer if he wasn't prepared to go into the principles of electromagnetism, and should just accept the magnetic repulsion at face value because the rabbit hole is too deep otherwise.

I always thought that social security was just a government effort to un-stupidate people who can't plan their financial lives and to keep sick, starving old people from rattling tin cups in public.  Make sure they have a predictable amount of SOME money on a monthly basis for shelter and food. The way things work, you are not supposed to "judge" people based on their histories or behaviors, for better or worse.

However, issues like mental illness and drug dependency don't keep a lot of dying people from rattling tin cups in public anyway. When a hurricane hit Mississippi around the gambling ships, a news report mentioned old people flooded from their shanties with no money. It turned out, they would wait every month for their SS checks, gamble it away, and then live on other forms of assistance for three weeks waiting for the next SS check to gamble some more i.e. gambling addiction.

I think the main issue with SS is that it is a big pot of money that nefarious politicians salivate over for potential pork barrel and redistribution rather than using it for what was intended.  Ronald Reagan screwed with SS big time by using the SS surplus to fund a tax refund and keep from increasing taxes while he was increasing military spending.  That by itself reduced the SS pot and led to the idea that the government could fund SS with IOUs. Social Security would be solvent if this hadn't been allowed to happen.  The problem didn't come about from "entitlement thinking", it came about from political greed and sleight of hand.

"The $2.7 trillion, which is alleged to be in the trust fund, was all spent for wars, tax cuts for the rich, and other government programs.  If the money is repaid at some point in the future, we could say is was just “borrowed.”  But no arrangements have been made to repay the money, and nobody in government is suggesting that the money should be repaid.  So, if it is never repaid, the money will definitely have been stolen."

http://dissidentvoice.org/2013/09/ronald-reagan-and-the-great-social-security-heist/

It's also a broader problem with the so-called public trust, where taxes are proposed with disguised, nominally specific purposes, but instead just go into "general funds" for any purpose whatsoever, either robbing Peter to pay Paul, or for pork barrel projects.

I have actually seen people around Santa Cruz who manage in mobile homes to live on social security, medicare and public assistance of various kinds.  Santa Cruz isn't cheap, so it takes some artistry to do this.

I am not sure I think that socialized medicine would work across the board, but extending some form of medicare down the age of 50 instead of 65 and an aggressive campaign of price controls over the lobbied health industries would go a long way.  From my observation, a lot of health issues arise with people who start to fall apart after 50, but still need to work and make a living. Medicare at 50 would deter many forms of age discrimination and make older people more "employable".

 Most people, even the self inflicted types, mostly still manage to stay reasonably healthy up to 50 or so.

« Last Edit: October 25, 2016, 12:05:08 PM by SUPcheat »
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PonoBill

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Re: Feynman
« Reply #4 on: October 25, 2016, 12:54:22 PM »
Way too rational.
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surfcowboy

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Re: Feynman
« Reply #5 on: October 25, 2016, 05:38:50 PM »
I agree. Don't ever let anyone read that response, they might learn something.

The fact that I can buy medicines in other countries for less than I can in the US drives me crazy.

PonoBill

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Re: Feynman
« Reply #6 on: October 25, 2016, 05:46:06 PM »
The only problem with extending medicare down to the level of most likely need for healthcare is that Medicare is already 3 to 1 out of balance, payments in vs. paid out. the age difference would actually help, but the medicare premiums would still need to be fairly high, and gap coverage would still be necessary. All in, pretty spendy. Most attempts at socialized medicine depend on the people who don't need it (young and healthy) to pay for the people who do.

Still, a simpler approach is feasible if costs got reeled in. Hard to imagine that with the big bribe purses of pharma and healthcare, but that' what would be necessary. Can't fix the insurance end without stabilizing cost.

And of course that means DEATH PANELS. Because yeah, there's a limit to how far you can take current medicine when the beneficiary is 85 years old and has been unhealthy for twenty years.

and yeah, got to fix the obesity epidemic.  Which means battling the food lobby.

Hmmm. that's probably five billion in bribes and two assasinations right there.
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surfshaver

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Re: Feynman
« Reply #7 on: October 26, 2016, 12:15:59 PM »
The root of the problems with Heathcare in this country stem from the fact that it's not a free market, there is no pricing transparency, and massive information asymmetries exist between the suppliers of health care (esp. hospitals and big pharma) and consumers.  Economists will tell you that when such information asymmetries exist, you have market failure (see George Akerlof and "The Market for Lemons").

Healthcare is so bad, most often you don't know how much a service/procedure will cost before it is done, but the provider won't tell you if you ask because they charge different rates for the same service depending on the insurance.  For a consumer, there is often no way to make a decision a priori to the performance of a service.  Even when you try to research it, they will not give you a straight answer.

This would be ok if paying insurance meant the out of pocket costs were minimal.  They are not.  I'm not talking about late-life stage hospitalization/major trauma/cancer, etc.  I'm talking about routine practice of specialists.


 


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