Entitlement Mentality and Early Retirees

I’ve heard some folks complain about their inability to get health insurance when they retire before the age of 65, the age when they would become eligible for Medicare. In fact, they will use this alleged “deficiency in the system” as a reason to support excessive federal involvement in or “socialization” of the health insurance system.

There are many perceived inequities in our current healthcare system.  But the health insurance gap for those who choose to retire before age 65 is not one of them.  The age one retires is most often a choice.  If a person retires at age 63 1/2, he has 18 months of COBRA to carry him through to age 65.  But if he chooses to retire at 62 or 55 why should he be “entitled” to insurance subsidized by taxpayers?  Early retirement was his decision.  He wasn’t forced to retire early. Just because we have the option to begin collecting reduced social security payments at age 62 does not mean we should also be entitled to subsidized health insurance at age 62.  The system wasn’t set up to do that, and there is no inequity in the way the system was set up.

In fact, if the system is changed at all, it ought to be changed to reflect the increasing longevity of retirees by increasing the age of Medicare eligibility.   The chart below shows male retirement age in 1950 to be almost 67, while life expectancy was less than 65, leaving zero years in retirement.  Based on CDC data

In 2005, the average retirement age was a few months less than 61, and the life expectancy was 75, providing 13.5 years in retirement.  These facts make the Medicare program something it was never intended to be: A medical plan for those who don’t need to retire and are healthy enough to continue working.

If there is any question why Medicare is underfunded, it is because of the entitlement mentality of existing and future recipients.

Will workers feel entitled to receive discounted insurance at age 50 or age 30?  Yes.  It is happening now.

The prevailing motive of many who are in favor of government option health insurance is their desire for something for nothing paid for by others from an increasingly socialized federal government – a desire to be “entitled” at someone else’s expense.

Refusing coverage for preexisting conditions is another matter. The two areas where there are inequities – refusing insurance to those with preexisting conditions and prohibiting insurance company competition across state lines which arbitrarily reduces competition – should be corrected.  That can be accomplished through legislation without excessive government intervention or unfair government competition subsidized by taxpayers.

Our Problems: More "Us" than Obama and friends

Rick Newman has an excellent article documenting many themes I have presented in Muccings over the years.

• We (our younger people especially) don’t want to work – we think we are too golden for that
• A larger proportion of us than in the past don’t want to sacrifice
• Too many of us are uninformed – and informed only by our uninformed pop cultural icons
• Too many of us feel “entitled”; entitled to the “best” and entitled on someone else’s dime

Read the excellent article below and see if you agree.

4 problems that could sink America

American ingenuity has solved daunting problems before and could again. But it would be a mistake to assume that American prosperity is on a preordained upward course.

[Related content: financial crisis, Barack Obama, recession, health care, China]

By Rick Newman, U.S. News & World Report

If we're lucky, the recession is winding down, and life will start to feel a bit more comfortable before long. But that doesn't mean things will go back to the way they used to be.

The global recession that began in America's housing market has shaken the world's economic order and possibly knocked the United States down a notch or two. The spendthrift American consumer is out of money. American wages are flat. Despite some hopeful signs, the U.S. economy could muddle along for years.

Meanwhile, actions in China -- rather than in the United States -- may have been the trigger for a global economic recovery. Many other nations will grow faster than the United States over the next few years and command an increasing share of the world's resources.

"The message to Americans," says Mauro Guillen, an economist at the University of Pennsylvania's Wharton School, "is you need to redouble your efforts to be more competitive."

American innovation has solved daunting problems before and could again. But it would be a mistake to assume that American prosperity will continue on some preordained upward course. Nations rise and fall, often realizing what happened only in retrospect.

Here are four problems that are undermining our future prosperity:

We don't like to work

Sure, now that jobs are scarce, everybody's willing to put in a few extra hours to stay ahead of the ax. But look around: We still expect easy money, hope to retire early and embrace the overly simplistic messages of bestsellers like "The One Minute Millionaire" and "The 4-Hour Work Week."

Unfortunately, the rest of the world isn't sending as much money our way as it used to, which makes it harder to do less with more.

Kids in Asia spend the summer studying math and science while American mall rats are texting each other about Britney and Miley.

White-collar jobs are now migrating overseas just like blue-collar ones. Kids in Asia spend the summer studying math and science while American mall rats are texting each other about Britney and Miley.

"We need a different mind-set," says Guillen. "People need to invest more in their own future. Instead of buying stuff at the mall, spend the money on evening classes. Learn a language or skills you don't have."

I recently interviewed entrepreneur Gary Vaynerchuk, who transformed his father's neighborhood liquor store into a $60 million business anchored by the Web site winelibrarytv.com. An overnight success? Hardly. Vaynerchuk has big plans, and he works at least 16 hours a day to achieve them. "If you want to work eight hours a day," he says, "you're going to get eight-hour-a-day results. There's nothing wrong with that, but I don't want to hear you bitch about money if you're only willing to work eight hours a day."

Vaynerchuk is only 33, but he has something in common with John Bogle, the founder of the Vanguard mutual fund company, who's 80 years old. I talked to Bogle recently about how Americans need to change their approach to work and money. He told me this: "We need more caution, more savings and we may have to work harder. Maybe we need more people who like to work and don't count down every day till retirement."

Nobody wants to sacrifice

Why should we? The government is standing by with stimulus money, banker bailouts, homeowner aid, cash for clunkers, expanded health care and maybe more stimulus money. And most Americans will never have to pay an extra dime for any of this. Somehow, $9 trillion worth of government debt will just become somebody else's problem.

When he was campaigning, candidate Barack Obama dabbled with the "personal responsibility" theme, and in his acceptance speech in November he called for a "new spirit of sacrifice." But now that he's in office, there's less interest in such quaint ideas.

During Obama's prime-time news conference about health care reform in July, a reporter asked the president if ordinary Americans would have to give up anything in exchange for better, more widely available care. Obama's answer: "They're going to have to give up paying for things that don't make them healthier." Hooray! Something for nothing! He may as well have said, "Here's a magic pill that will make all your problems go away."

Obama's plan is to get a tiny portion of the American public -- the wealthy -- to pay higher taxes for the benefit of the majority. Hey, while we're at it, let's see if we can convince 1% of the population to bear the entire responsibility for fighting two open-ended wars that are supposedly in the interest of every American. It would just be too uncomfortable to tell the middle class that if they want something, they need to earn it themselves.

We're uninformed

The health care smackdown -- sorry, "debate" -- is Exhibits A, B and C. The soaring cost of health care is a problem that affects most Americans. It's shrinking paychecks, squeezing small businesses, bankrupting families and swelling the national debt.

Yet outraged Americans seem most concerned about fictions like death panels and government-enforced euthanasia, while clinging to the myth that our current system of selective availability and perverse incentives somehow represents capitalist ideals.

But let's take a break from that burdensome issue to examine the likelihood that President Obama was born in a foreign country and hoodwinked America into believing he was eligible to run for president.

People who lack the sense to question Big Lies always end up in deep trouble. Being well informed takes work, even with the Internet. In a democracy, that's simply a civic burden. If we're too foolish or lazy to educate ourselves on health care, global warming, financial reform and other complicated issues, then we're signing ourselves over to special interests who see nothing wrong with plundering our national -- and personal -- wealth.

The iCulture

We may be chastened by the recession, but Americans still believe they deserve the best of everything -- the best job, the best health care, the best education for our kids. And we want it at a discount -- or better yet, free -- which brings us back to the usual disconnect between what we want and what we're willing to pay for.

Rationing is a dirty word, so we can't have a system that officially rations something as vital as health care or education. Instead, we have unacknowledged, de facto rationing that directs the most resources to those with the best connections, the most money or the savvy to game the system.

What keeps the rest of us content is the illusion that we, too, will eventually be able to game the system -- as long as the government doesn't interfere.

Solutions that serve some public good -- like Social Security and bank deposit insurance in the 1930s and Medicare in the 1960s -- usually require everybody to give something to get something. If it works, the overall benefits outweigh the costs.

Good programs leave individuals the option to pay more if they want more. Bad programs promise more than they can deliver. But often we don't know that until it's too late.

___________________

Update: Just a day after posting this, the veracity of this article was confirmed in a small way via a brief conversation in a restaurant with a recently retired couple and their 30-something daughter. During the course of conversation about current events, the trio showed vague understanding and no insight, and the daughter was entirely clueless as so many of us remain.

Parable of the Talents, Liberals and Conservatives

I recently had a discussion with friends about the meaning of the Biblical parable of the talents (see Matthew 25:14-30.). While “talents” at the time of the writing of this parable referred to a denomination of money, by coincidence of language, it could also apply to the current meaning of “talent” , that is, the innate or “God-given” ability to accomplish great things with what you are given.

My initial impression of the parable was that it was mean-spirited against those who lack God-given abilities. It gives preference to and rewards the wealthy or “gifted” among us. It condemns those without much ability to “outer darkness”, which in Bible-speak, means outside of God’s light, presence or grace – in another word, they are condemned to hell. Isn’t that a bit over the top?

Here is the quote of the entire parable:

13 “Therefore stay alert, because you do not know the day or the hour. 14 For it is like a man going on a journey, who summoned his slaves and entrusted his property to them. 15 To one he gave five talents, to another two, and to another one, each according to his ability [underlining added for emphasis]. Then he went on his journey. 16 The one who had received five talents went off right away and put his money to work270 and gained five more. 17 In the same way, the one who had two gained two more. 18 But the one who had received one talent went out and dug a hole in the ground and hid his master’s money in it. 19 After a long time, the master of those slaves came and settled his accounts with them. 20 The one who had received the five talents came and brought five more, saying, ‘Sir, you entrusted me with five talents. See, I have gained five more.’ 21 His master answered, ‘Well done, good and faithful slave! You have been faithful in a few things. I will put you in charge of many things. Enter into the joy of your master.’ 22 The one with the two talents also came and said, ‘Sir, you entrusted two talents to me. See, I have gained two more.’ 23 His master answered, ‘Well done, good and faithful slave! You have been faithful with a few things. I will put you in charge of many things. Enter into the joy of your master.’ 24 Then the one who had received the one talent came and said, ‘Sir, I knew that you were a hard man, harvesting where you did not sow, and gathering where you did not scatter seed, 25 so I was afraid, and I went and hid your talent in the ground. See, you have what is yours.’ 26 But his master answered, ‘Evil and lazy slave! So you knew that I harvest where I didn’t sow and gather where I didn’t scatter? 27 Then you should have deposited my money with the bankers, and on my return I would have received my money back with interest! 28 Therefore take the talent from him and give it to the one who has ten. 29 For the one who has will be given more, and he will have more than enough. But the one who does not have, even what he has will be taken from him. 30 And throw that worthless slave into the outer darkness, where there will be weeping and gnashing of teeth’” [underlining added for emphasis.](Matthew 25:13-30)."

Initial impressions do not necessarily result in correct interpretations. My initial impression tended toward the passive-aggressive, siding with the third slave. "If the Master (or God) is going to do that, he really is mean!" Our worldly biases and experiences often cloud our understanding, unless additional time and reflection is invested in understanding. This is true of my understanding of this parable.

Several points of understanding were gleaned from spending some time trying to understand this parable.

1) Knowing God. The third servant misunderstood the nature of God, as revealed when he told his master “You are a hard man…so I was afraid…” He was unnecessarily fearful because he didn’t know the nature of God. Fear is the bane of our existence. Fear makes life miserable – especially fear of God, our “Master.” Yes, Scripture encourages us to “fear God”. But I’m afraid that is where context and translation of ancient languages fails us. There are two different original meanings associated with our present day usage of “fear.” “Fear God” is used in the sense of exercising awe and reverence. Being “afraid”, a form of fear, is a waste of energy and emotion if you truly know God.

2) Using what you are given. The first two servants effectively used what they were given. The value doubled – compare that to today’s “value added” provider. The third did not use what he was given at all. He just buried it. There was no value added. When someone is given money, raw materials, talent (todays definition) and does nothing with it, what does that say about the person? What words come to mind? The words Jesus used were, you “evil and lazy slave.”

3) Be creative and show initiative. Apparently God likes us to think, to be creative and to show initiative. He doesn’t like excuses. He doesn’t like us to find fault with our master (‘Sir, I knew that you were a hard man, harvesting where you did not sow, and gathering where you did not scatter seed, so I was afraid, and I went and hid your talent in the ground) and then use that as the basis for doing nothing. This principle applies to our secular responsibilities as much as it does to our relationship with our God. Actually, a current day term for the behavior of the third worker might be “passive aggressive.” I guess the Master was lucky the slave found what he buried!

So, how might this apply to Democrats and Republicans; liberals and conservatives, the “entitleds” and the producers? Here it is: The Democrats, liberals and entitleds are going to hell. The Republicans, conservatives, and producers better not become passive-aggressive just because they are pissed at the Democrats, Liberals, and entitleds for being lazy SOBs.