INDEX

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AARP, 155

Accountable Care Organizations (ACOs), 109

Affordable Care Act (ACA) (Obamacare), 10, 12–13, 25, 105–6, 112

Afghanistan, 120, 126, 131

Agency for Healthcare Research and Quality, 110

Altman, Drew, 118

American Journal of Political Science, 154

Americans for Tax Reform, 155

Apple, 49

Atlantic, 109

automation, 35

banks, 59, 66

Baucus, Max, 148

Bell & Howell, 30

Bipartisan Budget Appeal, 17

Bonhoeffer, Dietrich, 27

borrowing, 6, 21–22, 29, 35, 61, 63, 80, 82, 153

Bowles, Erskine, 135, 158

Buffett, Warren, 137

Buffett Early Childhood Fund, 47

Bush, George H. W., 137

Bush, George W., 125

carbon tax, 150

Children’s Health Insurance Program (CHIP), 176

China, 39, 40–41, 41, 49, 126

Clinical Excellence Research Center (CERC), 117–18

Clinton, Bill, 5, 24, 137, 156, 162

Clinton Global Initiative University, 156

Coalition for Fiscal and National Security, 121

Cold War, 15, 16

competition:

education and, 45

from emerging markets, 38–44

healthcare and, 90, 95, 106

infrastructure and, 50–52, 51

investments and, 7, 30, 42, 53, 63

computers, 35

Concord Coalition, 17

Congress, U.S., 18, 23, 25, 54, 70, 87–88, 113, 128, 131, 148, 150, 152, 155, 156, 158, 184

Congressional Budget Office (CBO), 4, 8, 9, 11, 12, 52, 54–55, 68, 92, 140–41, 181, 182, 185–86

Consumer Price Index (CPI), 84

Corak, Miles, 33

Dartmouth Institute for Health Policy and Clinical Practice, 96

debt, 60

banks and, 59, 66

federal, 3, 5, 55–56, 55, 66, 169, 172, 181–86

of households, 60

post-World War II, 159–60

of private sector, 59–60

of states, 57–59, 180

U.S., as foreign owned, 21, 65

and U.S. dollar as global reserve currency, 66

see also deficits

debt, long-term, vii–x, 2, 3–5, 7, 17–19, 25, 119, 135, 151–62

budget gap and, 68–75

defense spending and, 14–17, 26, 119–21, 119, 126–28, 127, 129

drivers of, 8–10

economic costs of, 54–77

market crisis and, 5–7

national security and, 14, 119, 122, 123, 132

private-sector debt and, 59–60

slow-growth economy and, 7–8, 61

stabilization of, 24, 25, 70, 161

state and local imbalances and, 57–59

debt reform, 22–23, 135

business community and, 157–58

education reform and, 45–50

entitlement reform and, ix, 24, 26, 71–72, 77

healthcare reform and, see healthcare reform

impact of, on wealthy, ix, 26, 37, 70, 136

investments and, see investments

as moral imperative, 27–28

obstacles to, 23–24

raising revenue and, 23, 71, 134–50

short-term vs. long-term, vii–viii, ix–x, 2, 22–23, 54

spending cuts and, ix, 24, 25, 68–70, 71, 135, 138, 139, 171

strong presidential leadership and, 157

tax increases and, ix, 23–24, 25, 66–67, 70–71, 138, 139, 171

defense:

budget of, 17, 121, 123, 129

equipment and, 130

healthcare and, 16, 131

military bases and, 125–26

military pay and, 125, 130

national security and, 119, 121, 128, 132

as outdated, 15

reduction in ground forces and, 16–17, 125–26

reform for, 14–17, 123–32

retirement benefits and, 16, 130–31

spending on, 14–17, 26, 119–21, 119, 126–28, 127, 129

technology and, 121–23

Defense Advisory Committee, 15, 123–25, 128, 129, 130, 132–33

Defense Business Board, 130

Defense Department, U.S., 16–17, 121, 124, 128, 129, 130, 132

deficits, 7, 17–18, 137

in budget, 42, 80

reduction in, 23

in Social Security, 13, 80, 81

in trade, 39–40, 39

Domenici-Rivlin, 71

education, 18, 30, 34

college degrees and, 47–48, 48

competition and, 45

early childhood, 45–47

in engineering and science, 47–48, 48

parental involvement in, 46

reform in, 45–50

school preparedness and, 45–46

spending on, 45, 46, 49, 58, 168, 178

Eisenhower, Dwight, 157

entitlement programs, ix, 68, 134, 153

reform of, ix, 24, 26, 71–72, 77

spending and, 9–14, 24, 68, 72, 74, 79, 167

see also Medicaid; Medicare; Social Security

Ernst and Young, 42

Europe, market crisis in, 6, 67

Fannie Mae, 52

federal budget

debt’s constraints on, 56

defense and, 121, 124, 126, 129

deficit in, 42, 80

healthcare and, 90, 94–95, 112

interest costs and, 62

reform of, 158

spending accounts for, 166

spending/revenue gap in, 4, 9, 68–76, 69, 135, 138

states and, 57–58

Federal Reserve, 37, 61, 64, 87

federal revenue, 56–57, 66, 68, 154, 166, 169, 174, 185

options for raising of, 23, 68, 71, 134–50

spending of, see federal spending

see also taxes

federal savings, 42

federal spending, 10, 68, 72, 79, 154

cuts to, ix, 24, 25, 68–70, 71, 139

on defense, 14–17, 119–21, 120, 126–28, 127, 129

discretionary, 182–84, 183, 184, 186

on education, 45, 46, 49

entitlement programs and, 9–14, 24, 68, 72, 74, 79, 167

gap between revenue and, 4, 9, 68–76, 69, 135, 138

on healthcare, 12, 72, 74, 76, 90–95, 91, 92, 93, 94, 99, 99, 102, 105, 114, 118

Feenberg, Daniel, 146–47

Feldstein, Martin, 146–47

Fineberg, Harvey, 116

Fiscal Summit, viii, 158

401(k) retirement account, 87

Freddie Mac, 52

Friedman, Thomas, 158

Frist, Bill, 97

Gates, Robert, 16, 125, 130

Gates Foundation, 101

GI Bill, 30

global security, 127

government shutdown (2013), 151–52

Great Depression, 20, 78, 157

Greece, 6, 20, 67–68

Greenspan, Alan, 36

Hagel, Chuck, 16

Hatch, Orrin, 148

healthcare, 10, 79, 89–118, 98

ailing system of, economic costs of, 90–95

chronic conditions and, 102–4, 108, 109

cost consciousness and, 106

fee-for-service and, 107, 110

health outcomes and, 90, 92, 118

increasing value in, 96

integrated care and, 107–8

military, 131

performance of, 115–17

prescription drug spending and, 112

regional variations in prices of, 96–97

spending on, 12, 72, 74, 76, 90–95, 91, 92, 93, 94, 99, 99, 102, 105, 114, 118, 131, 167

system inefficiencies of, 96

see also Medicaid; Medicare

healthcare, costs of, 9, 10–13, 58–59, 58, 74, 93–94, 95, 115–16

chronic conditions and, 102–4

delegated decision making and, 100

fee-for-service and, 11, 97–100, 101, 106

fragmentation and, 104

high, factors explaining, 97–106

income and, 100

lack of global budget and, 105–6

lack of information and, 104

medical liability and, 105

out-of-pocket, 99, 99

price transparency and, 101

tax subsidies and, 100

technology and, 100–102

healthcare reform, 13, 25, 95–97, 106–11

access to information and, 110–11

Accountable Care Organizations (ACOs) and, 109

bundled payments and, 110

chronic illness management and, 109

competition and, 106

coordinated care and, 109

health insurance, 10, 98, 99, 101, 113, 142, 175

Heckman, James, 46

Holmes, Oliver Wendell, Jr., 134

House of Representative, U.S., Appropriations Committee of, 130

housing, 36–37

immigration system, 49

income, 31–34

healthcare costs and, 100

labor, 137

life expectancy and, 85, 86

median, 31, 32, 33, 186

Medicaid and, 175

in military, 125

national, 7

Social Security and, 79, 80, 87

tax deductions and, 146–47

see also poverty

income growth, 31, 38

income inequality, 27, 31, 37, 136

income mobility, x, 31, 32–34, 34, 35, 179

income stagnation, x, 31, 35, 37, 95

income tax, 141, 142, 143, 148, 185–86

corporate, 143–45

individual, 141, 146–47, 166

reform of, 139–45, 146–47

Independent Payment Advisory Board (IPAB), 112–13

India, 39

infant mortality, 90

inflation, 31, 66, 84, 130

infrastructure, 18, 30, 168

competition and, 50–52, 51

initial public offerings (IPOs), 41

Institute of Medicine (IOM), 90, 104

interest costs, 7, 8, 26, 62, 63, 63, 64, 168, 169

interest rates, 169

in Greece, 6, 67

increase in, 8, 19, 61, 62, 66, 67, 159

as low, 5, 18, 21, 51, 61, 64–66, 67

Internet, 35, 50

investments, 61–64, 159

competition and, 7, 30, 42, 53, 63

in education, 45–50

in future, 8, 21, 26, 52–53, 62–63, 70

in infrastructure, 50–52

in public-sector, 62

as tax exempt, 149

IRA account, 87

Iraq, 120, 126, 130–31

Isaacson, Walter, 49

Jefferson, Thomas, 157

Jobs, Steve, 49

Johnson, Lyndon, 157

Kaiser Family Foundation, 114, 118

Kearney, Nebr., 19–20, 21

Kennedy, James, 36

Kennedy, John F., 157

life expectancy, 9, 10, 12, 74–75, 85, 174

income and, 85, 86

lobbying, 17, 154–56

MacArthur, Douglas, 125

MacGuineas, Maya, 146–47

Macroeconomic Advisers, 152

Mankiw, Gregory, 150

manufacturing, 35

market crisis, 5–7

in Europe, 6, 67

markets, emerging:

competition from, 38–44

world economic growth and, 38–39, 40

Medicaid, 94, 118, 176

cost of, 9, 10, 16, 58, 115

managed care and, 114–15

reforming of, 114–15

spending of, 175

Medicare, 94, 96, 107, 155, 182

cost of, 9, 10, 16, 70, 147, 174

last year of life patients and, 103, 103

reforming of, 112–14

reimbursement rates of, 185

spending of, 97, 103, 103, 113, 177

Medicare Advantage plan, 109

Milstein, Arnold, 117

mortgages, 141, 146, 147

Mullen, Mike, 14, 119, 128

National Center for Education Statistics (NCES), 47

National Commission on Fiscal Responsibility and Reform, 135

National Commission on Physician Payment Reform, 96–97

National Guard, 125

national security, 16, 121, 128

national debt and, 14, 119, 122, 123, 132

NATO, 128

New York Times, 89

Norquist, Grover, 155

North Korea, 126

Obama, Barack, 125, 147

opportunities, 27, 34, 49

Organization for Economic Cooperation and Development (OECD), 43, 45, 46, 90

Panetta, Leon, 16

Patent and Trademark Office, U.S., 41

patents, 40–41, 41

pension plans, 59, 67

Peter G. Peterson Foundation (PGPF), viii, 13, 15, 22, 57, 121, 123, 126, 138, 152, 156, 158, 172

Peterson Center on Healthcare (PCH), 115–18

Peterson-Pew Commission on Budget Reform, 138

Pew Charitable Trusts, 33

poverty, 33, 46

progressive consumption tax, 148–49

progressive price indexing, 83–84

RAND, 101

Ravitch, Richard, 57

recession (2008), 37, 59, 64

research and development (R&D), 12, 18, 30, 126–27, 168

resource allocation, 46, 64, 95

retirement, 73, 79–80, 155

aging population and, 9, 12, 72–75, 73, 74, 75, 83, 85, 94, 174

low-income seniors and, 79, 80

military and, 130–31

personal savings for, 87–88

raising age of, 85–86, 138

Roosevelt, Franklin D., 78, 157

Rudman, Warren, 17

Saez, Emmanuel, 37

savings:

federal, 42

household, 42

national, 43, 43, 44, 95, 170

personal, 36, 36

precautionary, 57, 93

as tax exempt, 149

Schroeder, Steven, 97

sequestration, 121, 124, 139, 182

Shopenn, Michael, 89

Simpson, Alan, 135, 158

Simpson-Bowles Commission, 71, 139

smartphones, 35

Social Security, 73–74, 78–88, 155

balancing benefits and burdens of, 82–83

costs of, 9, 10, 13–14, 16, 70, 79, 167

in deficit, 13, 80, 81

improving retirement security and, 87–88

low-income seniors and, 79, 80

as mandatory by law, 78

reductions in benefits of, 152

reform of, 25, 83–87, 88, 138

revenues for, 13, 80, 83

taxes and, 80, 82, 84, 87, 185

Social Security Administration, 73

Solutions Initiative project (2011–12), viii

State Budget Crisis Task Force, 57–58, 59

states:

budget challenges of, 57–58

debt of, 57–59, 180

health expenditures of, 58–59, 58

Stiglitz, Joseph, 150

Stimson Center, 15, 123, 129

Stockholm International Peace Research Institute, 15, 120–21, 127

tax avoidance, 145

taxes, 9, 68, 100, 105, 134–50, 140, 153, 154, 155, 166, 185–86

on carbon, 150

deductions on, 139–42, 146–47, 155, 182

income, see income tax

increase in, ix, 23–24, 25, 66–67, 70–71, 138, 152, 155

loopholes and, 141, 145

payroll, 80, 82, 166, 186

progressive consumption, 148–49

Social Security and, 80, 82, 84, 87

tax expenditures, 139–42, 140, 141, 142, 149

blank-slate proposal for, 148

reforms of, 146, 147, 148

Tax Policy Center, 70, 147

tax rates, 147

on corporations, 144

marginal, lowering of, 149

for wealthy, 137, 138, 173

tax reform, 136, 139–45

challenge of, 146–47

tax system, 135–36, 145, 173

alternatives to, 148–50

technology, 100–102

defense and, 121–23

U.S. trade deficit in, 39–40, 39

Texas A&M Transportation Institute, 51

Thrift Savings Plan, 88

Titanic, RMS, 1–2, 19, 27, 54

trade, 39–40, 39

transportation, 51

Tsongas, Paul, 17

2014 Long-Term Budget Outlook, The (CBO), 55–57

unemployment, 34–35, 49, 66, 152

Up to Us, 156

Volcker, Paul, 57, 138

wages, 35

wealthy, 86–87

benefits for, 136

debt reform’s impact on, ix, 26, 37, 70, 136

income gains and, 37, 38

income taxes and, 142

tax expenditures and, 140–41, 141

tax rate for, 137, 138, 173

World Economic Forum (WEF), 50

world economic growth, 38–39, 40

World Intellectual Property Organization (WIPO), 40–41

World War II, 4, 30, 159–60, 181