David Walker, The Comptroller General of the United States, has developed this briefing (click the link above) about the the status of government expenditures, focusing on Social Security and health care. I suggest browsing through this 35 page .pdf for a full assessment of where we're headed if we do nothing.
He chooses not to address defense spending, probably because that's a fundamental and basic responsibility of government and does not have the built-in demographic time bomb as do the 'entitlements.'
Medicaid and Medicare are in deeper trouble than SS.
Why don't we hear about this dilemma on the campaign trail? Is it because the problem surfaces beyond the next 4-tear term?
Some excerpts below:
Current Fiscal Policy Is Unsustainable
•The “Status Quo” Is Not an Option
•We face large and growing structural deficits largely due to known demographic trends and rising health care costs
•GAO’s simulations show that balancing the budget in 2040 could require actions as large as
•Cutting total federal spending by 60 percent or
•Raising federal taxes to two times today's level
•Faster Economic Growth Can Help, but It Cannot Solve the Problem•Closing the current long-term fiscal gap based on reasonable assumptions would require real average annual economic growth in the double-digit range every year for the next 75 years
•During the 1990s, the economy grew at an average 3.2 percent per year
•As a result, we cannot simply grow our way out of this problem. Tough choices will be required---------------------------
Key Dates Highlight Long Term
Challenges of the Social Security System
2009 - Cash surplus begins to decline
2017 - Annual benefit costs exceed cash revenue from taxes
2027 - Trust fund ceases to grow because even taxes plus interest fall short of benefits
2041 - Trust fund exhausted
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Key Dates Highlight Long Term
Challenges of the Medicare Program
2007 - Medicare Part A outlays exceed cash income
2007 -“Medicare funding warning” triggered
2013 - Projected date that annual “general revenue funding” for Part B will exceed 45 percent of total Medicare outlays
2019 - Part A trust fund exhausted, annual income sufficient to pay about 80% of promised Part A benefits
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Three Key Illnesses
•Myopia
•Tunnel Vision
•Self-Centeredness
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Four National Deficits
•Budget
•Balance of Payments
•Savings
•Leadership
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Key Leadership Attributes Needed for
These Challenging and Changing Times
•Courage
•Integrity
•Creativity
•Partnership
•Stewardship
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