If you want to save entitlements in the long-term, we have to stop calling them entitlements. We have to admit that Medicare and Social Security are failures — fiscal failures. Once our leaders can admit these programs are now welfare for persons who do not put in nearly enough money to cover what they will take out, maybe we can fix the fiscal failure.
The long-ahead future obligations of Medicare and Social Security are so high as to seem like a fantasy. Long-term, we’ll be short almost $90 trillion in Medicare expenses, and about $18 trillion in Social Security. We can barely afford to pay the currents recipients of both programs. Despite cynical talk of Social Security and Medicare trust funds, there isn’t any money. The trust funds are just the feds writing IOUs to itself.
To meet these obligations, they have to be reduced. The only way to do that is to completely eliminate any older, upper middle class/wealthy American who does not need these services. Also, wealthier Americans need to pay considerably higher taxes into the programs, even though these people will receive nothing. We also need to implement a “Social Security, Medicare” value-added tax or straight sales tax of a few percent that would be dedicated to those programs. The first law of that tax should be that no one in Congress or the administration can touch it.
I don’t particularly enjoy advocating these positions, but who can suggest othewise when: 1) We have scores of trillions of dollars in obligations due in the next generations that we can’t meet, and 2) Americans have made it perfectly clear that they are opposed to reforms — such as private accounts — to the Social Security and Medicare welfare programs.
When we started Social Security, Americans lived on average 58 years. When Medicare was hatched, Congress promised that it would cost ridiculously low sums compared to what it costs today. Both are messes, but we’re stuck with them.