- ISIL creates all-female brigade to terrorize women into following Sharia law
- ISTOOK: Obama wants to be impeached
- Obama to Latin leaders: Help with border
- Military bans troops from Baptist church event honoring ‘God’s Rescue Squad’
- ‘Pocket drones’: U.S. Army developing tiny surveillance tools for the next big war
- Belgian cafe posts sign: Dogs allowed, but Jews stay out
- Gen. Dempsey: Pentagon studying Russian readiness plans not viewed ‘for 20 years’
- John McCain: Botched, two-hour execution of murderer is ‘torture’
- House GOP ready to move border bill
- Bomb squad called after live WWII artillery washes on Cape Cod beach
EDITORIAL: $30 trillion in red ink
The disaster keeps coming at us, and it’s a doozie
Question of the Day
The federal government owes $16.7 trillion to its creditors around the world, definitely including China. Each year, that number grows by $1 trillion, the amount President Obama has been borrowing to keep his bureaucracy expanding at a rapid pace. As troubling as these debt figures ought to be, an even scarier number looms on the near horizon.
The latest report from the trustees responsible for monitoring the financial health of Social Security and Medicare strongly suggests their patients are in critical condition. The government promises $30 trillion in benefits to retirees over and above the amount they can collect in payroll taxes and premiums.
Franklin D. Roosevelt's Ponzi scheme has been in cash-flow deficit since 2010, and its trust fund balances continue to run down to meet immediate obligations. Under optimistic assumptions, Social Security cash drawers will be empty by 2035, and there's reason to think the collapse will arrive earlier. The longer the economy remains stagnant, payroll-tax revenue can't grow, and the day of reckoning grows nearer.
More than this, expanding disability rolls increase the pressure on the Social Security infrastructure. Fewer people have jobs to give them the wherewithal to contribute to the fund. Demographics do not favor the scheme. When Social Security began, there were 42 employees for every retiree. In 2010, there were barely three per retiree. As life expectancies grow and birthrates fall, the end approaches with growing speed.
On the surface, the picture for Medicare is improving slightly. The Medicare Hospital Insurance Fund, which has only about a year's worth of assets, is currently expected to exhaust those assets in 2026 — two years later than previously expected. That prediction, however, is based on unrealistic assumptions of productivity growth in health care, restraints in health care costs and a nearly 25 percent cut in payments to physicians scheduled for 2014. That cut isn't likely to happen. Congress always rides to the rescue of the doctors just in time.
Under Obamacare, health care costs are rising faster than most critics expected. Health insurance premiums for the young and healthy, the demographic group least likely to afford them, will, for example, double in California, according to a recent analysis in Forbes.
The politicians, who rarely think beyond the next election, have made these entitlement programs untouchable, but the programs won't survive unless those politicians summon the courage to rein in the unsustainable. Business as usual has only one outcome, the collapse of Medicare and Social Security and the addition of $30 trillion to the nation's debt. This is the message nobody wants to hear, but the solution can't be avoided much longer.
The Washington Times
© Copyright 2014 The Washington Times, LLC. Click here for reprint permission.
About the Author
- EDITORIAL: Stopping police asset-forfeiture predators
- EDITORIAL: Obama's 'economic patriotism' means higher taxes
- EDITORIAL: Cellphones, steering wheels and safety
- LETTER TO THE EDITOR: Ship tours can foster dialogue
- LETTER TO THE EDITOR: Latin leaders profit from illegals
Latest Blog Entries
TWT Video Picks
By Mark Davis
The nation founders, the Lone Star State thrives
Get Breaking Alerts
- 'Pocket drones': U.S. Army developing tiny spies for the next big war
- Rahm Emanuel: Send illegal immigrant shelter kids to Chicago
- Tactical advantage: Russian military shows off impressive new gear
- CURL: Obama, staffers not even pretending any more
- HUSAIN: Fleeing Iraqi Christians find safe haven at the Shrine of Imam Ali
- DCCC raising money on suggestion Obama impeachment is imminent
- Washington Times strikes content and marketing partnership with Redskins
- NAPOLITANO: What if our democracy is a fraud?
- Family of Marine killed in Afghanistan pushes back against cover-up
- Pentagon running out of time to find mass of missing weapons in Afghanistan