09.18.07
Greenspan’s words continue to ring true
Greenspan makes the circuit, being interviewed by all the top news outlets and venues. Today I listened to him speak about his book of memoirs on KERA 90.1 FM. He reiterated that Medicare is really one of the biggest problems we have in terms of public policy. His view is that more well-off beneficiaries will be paying more in the future. (He was asked what policy he would prescribe.)
The white paper has a few choice Greenspan quotes which relate to his ideas; my policy prescriptions mirror his. The program should be there for those who need it–those of middle income to lower income. Also he says the government needs to communicate its direction so that those who need to plan, may do so. So far, I’ve seen no presidential candidate make any health care proposal that includes the reality of Medicare’s prospects. Hillary goes universal again, but with a private sector twist. None of them want to tackle the Medicare problem before being elected, my guess.
As we’ve seen the forces of globalization (excess liquidity) create housing bubbles which later popped world-wide, so too less demand by foreign investors in holding Treasuries may force the hands of politicians to deal with reality (see white paper). Last week, Bernanke indicated that the current account deficit was not sustainable over the long term. I hope our goverment makes smarter moves for the whole population before events force our hands, giving more pain economy-wide than some smaller adjustments.
