Both here in Mississippi and nationally, congressional candidates are making no mention of the serious challenges faced by the present iterations of the Social Security and Medicare programs. Baby Boomers poised to collect the entitlements are decidedly not ignoring the issues, but are nervously reading disturbing warnings that fiscal danger looms.
The Social Security and Medicare Trustees released their annual report earlier this month and documented the fiscal realities of the two programs. The latest projections show that Medicare Hospital Trust Fund (Part A of Medicare) will be depleted in 2026, three years earlier than projected last year.
At the point, trustees project that Medicare could continue to pay out 91 percent of current benefits in 2026, then see that decline to 78 percent in 2039, then rebound to 85 percent in 2092. Bottom line, less Medicare benefits to cover skyrocketing healthcare costs.
Social Security Disability insurance is projected to experience similar difficulties in 2032, which the Social Security retirement program is projected to be impacted in 2034 – that is to say that the Social Security Trust Fund will deplete its reserves by 2034.
What does that mean? It means that Social Security will in 2034 not be able to pay beneficiaries in full and that beneficiaries will face a 21 percent across the board benefit reduction from numbers shown on the annual benefits projections from the Social Security Administration.
Those facts matter only to voters who have plans to actually receive Social Security and Medicare benefits from the same federal government who deducted taxes supposedly dedicated from their paychecks expressly for the purpose of funding the programs.
What retirees and Baby Boomers really have in terms of that “nest egg” they thought they had in Social Security and Medicare when FICA was being deducted from their payroll checks is in reality a pile of congressional IOUs in a U.S. Treasury Department Bureau of the Public Debt’s filing cabinet in Parkersburg, W. Va. The bonds aren’t backed by the cash we gave the government from our payroll deductions.
They are backed by the “full faith and credit” of the federal government. But Congress long ago spent the actual assets to fund other government functions and to redeem the bonds, the government would now have to borrow money or raise taxes.
Conservative Republican former Social Security and Medicare public trustee Charles Blahous recently wrote: “What’s really important is the magnitude of the (Social Security and Medicare) shortfalls and the difficulty of correcting them, which grows each year. Whether depletion is distant or near, the problem had to be confronted sooner rather than later. Unfortunately, later has come sooner than the trustees thought it would.”
Democratic former chief economist to former Vice President Joe Biden took this posture on the entitlement programs: “What is the way forward? Surely, the sooner we tackle these shortfalls, the better. Wouldn’t it be awesome to avoid yet another one of those fiscal cliffs that we know is coming but are too dysfunctional to address until the last minute, when we kludge together some patch?”
The bottom line is that Social Security and Medicare as we know it today is on borrowed time. “Saving” the programs – and even that concept is a stretch in the current fiscal and political climate in this country – will require additional government revenues and austerity measures both in terms of healthcare costs and in program eligibility.
In other words, the entitlements have to be reformed at the same time that new revenues are found to shore up the shortfalls. And yet, while cruising through congressional elections, voters aren’t having conversations with the candidates about these two vital issues – and that fact is a true electoral mystery.
Sid Salter is a syndicated columnist. Contact him at sidsalter@sidsalter.com
Wednesday, June 13, 2018
Sid Salter: Whistling Through the Graveyard
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18 comments:
Liberal Democratic leadership (perhaps an oxymoron) opposes any restriction on immigration and lam bast the president about such daily.The normal democrat counts on the state and Feds to support them, in whole or part. What a juxtaposition! The normal democrat should be violently opposed to illegals consuming $50,000 giving birth at Baptist because that is going to be less for the democrats to have.Yet the dem leadership continues to support that which is inimical to their followers and yet the sheep still follow. These are very ignorant souls.
KF, you could save some money by not paying for Sid (MSU propaganda specialist) for stating the obvious every week.
Anyone recall Salter ever asking Thaddeus to lay off the Chinese debt purchased budget busting deficit spending?
The only thing that is going to save SS is more workers and most immagrants work.
3:07 PM Back in the old days they used to complain about black people (most used the n word actually) being born at Baptist. The Confederacy is never coming back.
Liberal media agent, Sif Salter, refers to SS as "entitlements", the new liberal term for the money hard working people paid in, Under law, and expect to get back after retirement. How is that an entitlement?? It's our money...
I'm with 6:10. Since I'm self-employed I'll fork over almost $16,000 in SS tax this year (plus several thousand in Medicare taxes). "Entitlement?" Try calling it a lousy return on my money.
@6:10 It's an Entitlement because it was taken by force. We do not have the power to keep it if we wanted to. If we had an opt in/out mechanism, it wouldn't be called an entitlement, because most would opt out, but then they would be SOL in old age.
6:54 if you were forced to put 13% of your earnings in a 401(k) every year instead of giving it to SS, you would be a millionaire at retirement. Hardly SOL.
I'm a conservative and I support immigration as long as we know who is coming in. For lots of reasons...most of which which are beyond 3:07's ability to understand.
How is being conservative germane to your immigration position?
(1) Starting with people born after 1980, gradually raise the retirement age to 70 with reduced benefits available at age 65. (2) Increase the Social Security tax on higher earning taxpayers. (3) Cut Social Security benefits across the board by 1% per year for 5 years. Problem solved.
ROFL! Sid was a conservative and Republican before many of you were born and when this State was dominated by Democrats.
The idea that he's a liberal is hysterically funny!
The idea that Sid is conservative is woefully ignorant.
How is being conservative germane to your immigration position?
We didn't say nothing about no Germans. -- Sheriff Buford T. Justice
The idea that the misnomer "entitlements" is somehow a liberal construction is ludicrous.
"“The one thing that got away from us, which is my signature issue, is entitlement reform,” Ryan, R Wis., told Hayes at the Midwest Conservative Summit, sponsored by The Weekly Standard and held in Wisconsin." Paul Ryan, April 30, 2018.
There are hundreds, if not thousands, of more examples of how Republicans have turned contractual obligations, into "entitlements". It's much easier to demonize that way. It's easier to sell "entitlements" because that denotes that (pick your target) is getting something for free from good, hard working, 'Mericans. The people actually about to be screwed, are the people who actually funded it, but that certainly won't go over well in this day and age, so you convince the people that are going to get screwed that its "their" or "those people's" fault, not utter and complete mismanagement and fealty to the donor class. Social Security is an easy fix. Take the $128,000 cap off Social Security. Actually tax all income for Social Security, not just the first $128k. But the donor class won't stand for that, and thus we have "entitlements". Medicare is a more problematic fix, as that would require having some kind of national standard for actual medical costs, and the medical and pharmacy lobbies sure ain't gonna go for that, so you can continue to expect $9,000 kidney stone ER visits that consist of an IV and maybe 90 seconds of human interaction.
But yes, it's all Democrats, illegal immigrants, etc. fault. Certainly not Republicans. The fact Republicans have had control of the House of Representatives for 19 of the last 23 years, and the House having the "power of the purse", is merely a coincidence.
It's pretty funny when you hear baby boomers complaining about the lazy generation x and millennials and yet refuse to acknowledge that they have left this country in far worse shape. There is no wage growth, education is unattainable without a mountain of debt, our healthcare system is broken, and the environment is wrecked. Maybe try to look into a mirror instead of blaming the Mexicans and the liberals for all the issues you old farts. If anything, I think we should make the boomers fix something out of their own pockets instead of continuing to bleed the system dry.
9:20. This boomer agrees. Also, Sid is dishonest. He strongly supports those that caused this mess like Thad.
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