"We made too many wrong mistakes..."

Yogi Berra’s notable malapropism explaining the Yankee’s loss of the 1960 World Series may be the way future apologists explain the train wreck this administration has created since taking office.

Thanks to the recent partisan enactment of healthcare “reform,” the budget deficit (you know, that pesky tax revenue-government spending thing), which was about 3% of GDP in Bush’s last year, is now in excess 10% -- more than triple. And the all important debt-to-GDP ratio has gone from 40% when Bush was president to 63% today and is projected by OMB to grow to 90% by 2020. That’s Obama’s legacy to future generations.

To put this debt-to-GDP ratio in an historical perspective, the ratio during the Carter administration averaged a paltry 28%. Yet, those of us who suffered through Carter’s presidential ineptness remember the up close and personal glimpse of what economic Hell looks like, and I for one don’t want to repeat it. Yet anyone with a modicum of understanding of history and economics knows what’s in store for us after four years of Obama and (perish the thought) four more years after that.

The tax and miscellaneous revenue taken in by the federal government is recently about $2.5 trillion annually. The current national debt is about $12.5 trillion but with the accumulation of deficits in Obama’s 2011 budget the national debt will rise to over $20 trillion in 2020. That’s if his rosy future scenarios trend out as predicted, which they never do.

Most of us have trouble comprehending figures denominated in trillions, so think of ObamaNation as if it were a family. Federal tax revenues are the family’s income, and the 2020 national debt is the mortgage on their house. The mortgage would be almost 45 times greater than the family income. That is like a family earning $100,000 having a $4,500,000 mortgage! You wouldn’t find too many mortgage lenders who would take that deal, but the one that has financed this family’s abode has been on a drunken spending spree for years.

An interest-only mortgage at 5% on their house would require annual interest payments of $225,000 per year and conventional mortgage payments that retire the debt principal would require much higher outlays. This is not a happy family. Not only is there nothing available for living expenses, but also the interest exceeds the income. You might suspect that the eviction notice is being written.

That is the state of affairs in which ObamaNation now finds itself. In 2009 it spent $1.2 trillion, or about 50%, more than it brought in, and we can expect that to continue for the next ten years as the Obama budget runs deficit after deficit in a steady march toward a $20 trillion national debt – 90% of the GDP. For comparison, from 1789 (the year after the U.S. Constitution was ratified) to 2008 (Bush’s last year), this country accumulated only $5.8 trillion of public debt.

Don’t get me wrong. I’m not exonerating the Bush or Republican reckless spending binges, but Obama and the Democrat House have given new meaning to deficits and debt.

Spanish philosopher Jorge Santayana said if we do not learn from the mistakes of history, we are doomed to repeat them. Obama said healthcare reform was essential to restoring fiscal sanity. So let’s look at the promises of similar social programs in past administrations. I’ll try to make this short, because it’s painful.

The Social Security program was conceived in 1935 by then President Franklin Delano Roosevelt. When it was launched, there were roughly 16 workers for every beneficiary, more than enough to support a modest pay-as-you-go retirement program. That’s how Social Security was sold almost 75 years ago. Today, however, there are 3.3 workers per beneficiary and by 2030 when the last Boomer retires, the ratio will be 2.

Instead of “pay as you go” the Social Security program is really “you pay and I’ll go” because it was nothing more than a Ponzi scheme from the start. Any demographer who can find his rear end in a dark room will tell you that family sizes fall as a nation gets wealthier. Children, who were the source of the family’s well-being in an agricultural/industrial era become the beneficiaries of family well-being in a more sophisticated economy, so family sizes decrease. Parents averaged 3.6 children when Social Security was hatched. Today it’s barely 2 children – enough for the parents to replace themselves, but not enough to produce population growth. Life expectancy at birth in 1935 was less than 62 years; today it’s over 78 years.

Instead of incenting an old age security system that would have made possible independency and self-funded retirement – a sensible use of government policy – the patrician FDR’s program forever more made people dependent on government. And, unlike a privately funded retirement plan or annuity, which is your individual property whether you live or die, your Social Security account belongs to the government, not your estate. So if you die the day you’re scheduled to start receiving payments, your heirs get nothing for all of the years you paid into this Ponzi scheme.

This year, for the first time, Social Security paid out more than it took in by $29 billion. This wasn’t supposed to happen until 2017. But recent high unemployment produced fewer paychecks to pay Social Security taxes, and many who can’t find work are taking their place at the trough as beneficiaries earlier than they planned. Instead of junking this flawed program, some hapless future president and congress will try to fix it.

Now take Medicare, a product of Wibur Mills’ alcohol-soaked brain and his tag-team partner Lyndon Baines Johnson. Like FDR, LBJ thought big when it came to spending other people’s money and he gave us the Great Society programs.

In 1965, as Congress considered legislation to establish a national Medicare program, Wilbur Mills, the Chairmen of the House Ways and Means Committee estimated that the hospital insurance portion of the program, Part A, would cost about $9 billion annually by 1990. The actual Part A spending in 1990 was $67 billion. The actuary who provided the original cost estimates acknowledged in 1994 that, even after conservatively discounting for the unexpectedly high inflation rates of the early ‘70s and other factors, “the actual [Part A] ‘experience’ was 165% higher than the estimate.” Shocking.

Medicare A and B was predicted to cost $12 billion in 1990. It cost $110 billion – off by a factor of 10. Medicare’s home care benefit was projected to cost less than $1 billion by 1992; its actually costs were $17 billion. Thinking we weren’t spending enough on Medicare, congress added in 1988 a catastrophic coverage benefit to take effect in 1990. In July 1989, the CBO doubled its cost estimate for the four-year period 1990-1993 from $5.7 billion to $11.8 billion.

Wilbur Mills was forced out of congress after the Washington Park Police stopped his car for suspicion of drunk driving and his stripper girl friend fled the scene by jumping into the Tidal Basin. But while Mills and Johnson have since been gathered to the loathsome bosom of their reward, we’re forced to pay for Medicare and Medicaid.

According to the most recent Social Security and Medicare trustees report, the unfunded liabilities of these New Deal and Great Society programs now exceed $100 trillion dollars. Add the unfunded Medicaid mandates imposed on the states along with the pension liabilities of millions of federal, state, and local government employees and the total unfunded liabilities our government has given taxpayer is beyond comprehension. The entire net worth of the U.S., if appropriated by the government is only about $55 trillion.

You get the picture. FDR and LBJ promised what they couldn’t deliver and both died before the public saw the consequences of their perfidious handiwork. Can anyone really believe Obama’s assertion that his healthcare program will not only pay for itself but will generate savings that can be used to reduce the deficit?

Recently, Senator Claire McCaskill of Missouri confessed that the Democrat party had probably oversold healthcare reform. “The side which I’m on, that voted for the bill, probably is over-promising, [has] not been clear enough about the fact that this is going to be an incremental approach over time, [and] the benefits aren’t going to be felt by most Americans immediately,” McCaskill said.

How enchanting is the simplicity of pure stupidity.