Monday, January 7, 2013

Our $1/2 Trillion Entitlement Deficit

From Charles Biderman at TrimTabs, Chuck explains the sorry state of Medicare and Social Security:
Last year, employment taxes were something over $600 billion and old folks like me paid $100 billion towards our Medicare coverage. The Heritage Foundation reports that total Social Security and Medicare spending was $1.28 trillion. In other words, even by boosting payroll taxes $110 billion, the entitlement deficit will still be a half a trillion dollars.
Today there are 2.9 workers for every retiree. In 20 years that drops to 2 workers for every retiree. That means the entitlement gap between employment taxes paid and the amount spent has to surge, even if the retirement age is boosted to 70 and means testing begins.
So, even at best, our nation's entitlement deficit is $1/2 Trillion dollars. Shame on the politicians who want to put their heads in the sand and pretend that everything's OK.  Worse, shame on those same people who vilify those politicians that want to right the ship!

Our entitlement deficit goes nothing but higher.  Have a look at projected increases in Social Security and Medicare/Medicaid spending:

In just four years, the end of do-nothing-Obama's 2nd term, the entitlement deficit increases to something like $700 billion.   Yeah, everything's fine, keep your heads in the sand.

Oh, and to those young readers who support Obama, don't blame me when there are no jobs for you when you graduate in the next few years or if there's no Medicare or Social Security when you retire.   If Medicare and Social Security survive, then the benefits might buy a cup of coffee---compliments of the Federal Gov't.

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