Economists behind Barack Obama

I just finished reading Obama's business brain trust, which unveiled 14 Obama's economic thinkers. Among them, there are 4-5 CEOs, 3 professors, people from Bill Clinton's administration(about 3 or 4), and other experienced economists.

Warren Buffett; Eric Schmidt (Google CEO); Jamie Dimon (JP Morgan Chase CEO);
This group share the idea that tax breaks for the rich is wrong.

Austan Goolsbee(U of Chicago)
Jared Bernstein (Economy policy institute director)
These two economists support tax raise

Robert Rubin(former treasury secretary);

Larry Summers(Harvard, served in the Treasury during Clinton administration)

They support Obama's call for economic stimulus

Others (7)

including education, foreign trade, energy, deficit, etc.

This is a diverse collection of economic thinkers and they are not completely agree with each other. Under crisis, it is especially important for Obama to choose his Treasury secretary wisely and to use his business brain properly.

come to the end

Thanksgiving hasn't come, but I want to thank this blog project ahead of time!
There is one thing I didn't mention in my profile that this is my first year in U.S. I barely have a sense of belonging and inevitably watch the society as an outsider. I've been always remembering how my politics professor answered the question what made one an American. She said it was the political culture that every American shares.
This blog gives me an opportunity to get closer to this great nation emotionally. My topic is away from the conflicts between my country and U.S.; my topic drives me to understand how the social insurance system runs; my topic is closely related to the benefit of ordinary Americans; my topic pushes me to think for the future of the United States from an American's prospect. I feel more engaged in this society and I am definitely caught by the feeling.

Video:Sen.McCain Responds to Budget Deficit

http://www.youtube.com/watch?v=ikPDMsSyR_0

grow as a thinker

Before working on this blog, i was an ignorant future economics major student shocked by the huge number of this year's budget deficit as everybody else. I could only see the number on the surface but didn't know why. It was definitely not something good but I didn't know the effects on our life and I could not see the future. However, after looking into the problem, I think I found the biggest threat to the future of budget deficit-Social Security and Medicare program costs. Crisis will have an end; the expense on Iraq war can be cut gradually with the withdraw of our troops; homeland security is a long run investment; but Social Security and Medicare expenditures are pure consumption and have no chance to shrink in at least a decade.

At first, I didn't really know the system and the way social insurance program is funded, I thought we would encounter this problem in 2009 fiscal year since the baby boom generation were turning 62 and eligible to social security benefits. However, my born optimism got the upper hand later. After studying the social insurance issue, I noticed that the problem will not hit us until at least three years later. My optimism comes from the faith in America financial crisis management capability and the surpluses in Social Security tax income over expenditures we should should have accumulated these few decades when baby boomers are working hard for their retirements. It turned out to be my wishful thinking. I failed to notice some concrete data and foresee the burden on our generation. Besides searching news, I went for budget office documents and the dry data report. A record of surpluses doesn't necessarily mean sustainable funds. Data shows expenditures grow faster than tax income does, surpluses shrinks over years, and in 2011 due to retirement population the sudden soar in costs would drag surpluses in to deficits. Social Security funds not only would lose the ability of leading money to other government programs which was the case for quite many years, but also lose capability of supporting itself. Government has used the surpluses elsewhere so we actually cannot count on previous accumulation.

Indeed, it's easy to say then to do. After Iraq, we still have Afghanistan. In fact, the more I look into the issue, the more I found myself naive. There are so many factors which can exert influence on the budget office that I cannot think of a well-rounded plan. Maybe after election, decision makers will have time to really think about how to reset financing arrangement.

Three blogs I recommend

1. homeland security by O Bro
This blog focuses on airport security system, which is a crucial component of homeland security. He mainly introduced two new technologies and discussed whether we should devote money and energy into airport security system under current economy situation. Two core factors are the cost of new security system and the possibility of another terrorism attack. The most prominent part of this blog is blogger's careful response to readers.

2. What About Afghanistan? by Jane Doe
I think everyone should have a look on Afghanistan! We've been leaving Afghanistan in shadow for too long time. Jane Doe shows a good understanding on this issue and clearly presents the two candidates' stand, as well as her own. The questions brought out by her are thought provoking. What's more, I found her blog list really interesting and helpful.

3. A SHOT IN THE DARK by Ennaeiram
This blog is about gun control. Though personally, I have a very clear stand on the issue, it's necessary to discuss the different ways to interpret the United States Constitution second Amendment. Also, blogger has brought up some interesting articles.

My Dilemma

My very first attempt of this blog is to look into 2008 deficit and try to seak a way to cut the growing deficit in next fiscal year. I started with learning the concept of deficit. To my surprise, deficit is much more complicated than I expected. Basically, budget deficit consists with structural and cyclical components. While researching the topic, I found that many pundits mentioned the expense on health care would soar because of the retirement of baby boomers. However, after I looked into the issue, I found that it is a problem but not a cause for this year's deficit and will not really be a problem for 2009 fiscal year, not even 2010!

In 2008, the first wave of baby boomers becomes eligible to social security benefits if they choose to retire at age 62. However, they will not be eligible to medicare until their 65(also after retirement), which is year 2011. Since deficit is always discussed within a year, it's possible that if U.S. can overcome financial crisis by the time then a back of economy growth will relief the pressure caused by health care. Also, the baby boomers are not likely to retire early due to the current bad economic situation.

closing week of the longest presidential campaign!

I would like to share this sentence from Obama's "closing arguement":

"In one week, you can put an end to the politics that would divide a nation just to win an election; that tries to pit region against region, city against town, Republican against Democrat; that asks us to fear at a time when we need hope," Sen. Obama told a crowd of several thousand at Canton's Civic Center Arena.