While Ukraine and other news items are grabbing the headlines, one long term problem that hits closer to home is that of Social Security. Although policy wonks are debating solutions to keeping Social Security solvent and political commentators are scaring people with specters of an insolvent Social Security system, a more pressing problem is when people should start taking it.

While one can argue (and some have) that Social Security won’t be there for them when they get there, the Social Security trustees are predicting that the system will be able to pay roughly 75% of promised benefits when the “trust fund” is exhausted sometime in the decade of the 2030’s. Although this not great news for those in my generation, it is not the same as looking at zero Social Security.

So, when should it be taken? Obviously, there is no right answer for everyone, as everyone faces different constraints and choices. But for most of those who can do it, the obvious answer is to wait until 70 to maximize the monthly payout. People who question the wisdom of this by bringing up objections such as “missing out on 8 years of Social Security payments that could be invested, etc., etc.” are, as many people do, mistaking the Social Security system for an investment program rather than an insurance program. The risk that most of us will face in retirement will be running out of money. As most of us don’t know how long we are going to live, it makes sense to go for the option that gives us that maximum cushion against that, which is the higher payout.

Sure, if you wait until 70 to take Social Security and then keel over at 72, you will be kicking yourself for the eight years that you missed out on. But seriously, if you go to the good place after you die, you likely won’t really care. And if you go to the bad place, you will have more pressing problems than missing out on 8 years of Social Security payments. And if it turns out that this life really is all that there is, then it doesn’t really matter because you will be just as dead and non-existent in either circumstance.

So go ahead and assume the best; that you will have many long years in retirement with your friends and loved ones. And do your best to make sure that you won’t be a burden on them by waiting until 70 to take Social Security.

Last week, the White House announced that only 1.08 million people in the age range of 18-34 had signed up for the ACA health care exchanges, or about 40% of what they estimate is needed for the exchanges remain financially solvent without a taxpayer bailout. Dana Milbank of the Washington Post recently wrote a column trying to explain why this demographic segment (aka “millennials”) has, in his words, “abandoned” Obama. While the article perhaps has some insightful points about this generation and some comments about how the Obama Administration did not work to keep the youth engaged after the 2008 campaign, his assertion that the youth are more liberal than earlier generations (a characteristic that has generally been true of people during the 18-34 time in their lives going back at least 3 generations) and that they are “abandoning” Obamacare because he didn’t fight hard enough to put the “public option” in Obamacare appears to be the work of someone who is trying very hard not to admit that his opponents were right about the law.

Simply put, by now the fact that Obamcare is not, broadly speaking, a good deal for young people is pretty well established. The law, financially speaking, depends upon young people over-paying for insurance so that their money can be used to subsidize the old and the sick. In other words, the law depends on young people getting ripped off. Consequently, it should be pretty obvious that it is not in the economic interest of young people to take part in a system that is not a good deal for them (the individual mandate recognizes that Obamacare is not a good deal for many people, hence they must be forced to take part).  Young people are simply responding to economic incentives the way that other people do (and always have), which appears to be a difficult thing for some people to accept.

Furthermore, the entire Obamacare structure was not even a workable piece of legislation. This is a fact that Obama himself continues to acknowledge as he unilaterally (and illegally) suspends and delays various provisions that either can’t work, or are horribly politically unpopular. The reason the structure can’t work smoothly (recognizing that whether something “works” or not depends upon one’s definition) is that it is trying to micromanage roughly 1/6^th of the U.S. economy (roughly $2.7 trillion); a GDP number that only 4 countries in the world surpass. Countries that have tried to micromanage their economies to this extent have all failed economically. That the wheels have come off of Obamacare is hardly surprising, as this is what usually happens when grandiose plans meet economic (and in this case, political) reality.

That people like Milbank feel the need to come up with alternate scenarios for why young people are fleeing Obamacare reminds me of leftists a generation ago trying to find alternative explanations for why the Berlin Wall came down and communism in Eastern Europe collapsed. Rather than accept the obvious lesson that economic central planning was not a prosperous economic system compared with free market capitalism (and that forcing people to take part in such a system as the Berlin Wall was meant to accomplish is hardly the way to happiness), they preferred to be puzzled instead. Perhaps the idea that they could have been wrong, while those that they had derided as wicked, intellectual inferiors could have been right was too much to accept. Or perhaps they were genuinely surprised that all of the laws and repression could not overcome market forces in the end. Whatever the motivation, economic reality will always eventually intrude. When it does, it tends to upend, sometimes violently, the plans and assumptions of those who thought that they could ignore it. The proponents of Obamacare are discovering that now.

This last week, Republican David Camp released a tax reform proposal that is one of the most serious ones put forward in a long time. In addition to reducing the number of tax rates and eliminating a raft of loopholes and deductions, the reform also saves middle class families from being ensnared by the Alternative Minimum Tax (AMT). The AMT was a reform put in place decades ago to ensure that rich folks would not be able to escape paying taxes. Today, because of inflation, the AMT traps thousands of middle class families who were never its intended targets. In short the reform lowers tax rates, broadens the tax base, makes the tax code simpler, and apparently raises nearly the same amount of revenue as the current system.

However, the reform itself has received a lukewarm reception on Capitol Hill. While politicians on both sides of the political aisle have largely eschewed the vitriolic, “this is the worst thing I have ever seen” rhetoric that many have come to expect, most of them have given the sort of backhanded, “we will study this proposal”, rhetoric that means that nothing will get done. Meanwhile, the lobbyists for various constituencies have been out in force arguing that the reforms will damage America’s economy, America’s ability to compete globally, etc. etc. Given that any tax system (including this one) has its winners and that those folks may be disadvantaged by a wholesale change in the tax code, resistance is hardly surprising. However, in a political system in which the two parties don’t even seem to be able to agree what color the sky is, it is interesting that neither appears too interested in this reform.

What this indifference may indicate is that the American political system may simply no longer be capable of making common sense reforms that most people (on both sides of the political aisle) realize need to be taken. The current tax system is an economic drag that costs Americans more than $100 billion a year to comply with (in economic terms, this is a dead-weight loss in that the money is spent simply to move money from Point A to Point B without creating any economic wealth). Everyone knows that if one were building a tax system from scratch, one wouldn’t build this complex, byzantine fun house of a system. Anything that simplifies the system and also raises the same revenue is an improvement that large segments of the political class should be able to get behind. The fact that they are apparently not is worrisome.