Grrrrrrrr... saw another Social Security doomsday segment. People, Social Security is projected to be fully funded until 2044. Anyone who tells you otherwise is either lying or uninformed. Don't believe them.
Many times what you will see in "debates" about this issue is that opponents of social security will merge the program's fiscal outlook with Medicaid and Medicare's numbers as well to look at the "entitlement program crisis"(dun dun dunnnnn).
Medicaid and medicare are on an unsustainable course because of runaway inflation in health care costs. This has nothing to do with Social Security being broken and everything to do with the United States having one of the--if not the--worst health care systems in the industrialized world (unless you are filthy rich that is...).
Social Security will exist long after you and I are dead... unless Republican get their hands on it. But that's a political question not an economic fact.
You're right that Medicare is in MUCH worse shape than SS, but you are not correct that SS is fully funded. There is a "fund", but that fund consists of IOU's, not real money...US Treasuries. Basically, back when we had the giant Boomer cohort, the government was collecting more in SS tax than it was paying out. The government expanded programs and used this excess to fund these programs. They issued bonds and "sold" them to the SS fund. There is NOTHING in there. Until now, we have been taking in more in SS taxes than we paid out in benefits. YESTERDAY an announcement was made that they would try to collect on the IOU's in order to pay SS benefits to current beneficiaries. See: http://news.yahoo.com/s/ap/20100315/ap_on_bi_ge/us_social_security_ious_8
ReplyDeleteMedicare has been in the red for quite awhile now. Benefits will continue as scheduled for awhile, but when you think about it, we used to spend our generally collected taxes PLUS the SS tax excess from the Boomers. NOW, we are goint to have only our generally collected taxes MINUS the benefits paid out to the Boomers. It is truly a catastrophe in the making...already programs like Education and research are feeling the pinch and it's only going to get worse. Something WILL need to be done eventually and the longer we wait, the worse it's gonna be!