I watched the debate last night and was particularly interested in the segment concerning Social Security and Medicare. I was disturbed to hear the prophecy of doom posed to the candidates by this question:
WALLACE: “All right. The one last area I want to get into with you in this debate is the fact that the biggest driver of our debt is entitlements, which is 60 percent of all federal spending. Now, the Committee for federal — a Responsible Federal Budget has looked at both of your plans and they say neither of you has a serious plan that is going to solve the fact that Medicare’s going to run out of money in the 2020s, Social Security is going to run out of money in the 2030s, and at that time, recipients are going to take huge cuts in their benefits.
So, in effect, the final question I want to ask you in this regard is — and let me start with you, Mr. Trump, would President Trump make a deal to save Medicare and Social Security that included both tax increases and benefit cuts, in effect, a grand bargain on entitlements?”
Candidate responses and proposals can be found at The New York Times transcript of the debate.
Wanting to know the truth about Social Security and Medicare solvency, I went looking and found the reports. The Social Security forecast can be read at the 2016 Annual Report of the Board of Trustees of the Federal Old-Age and Survivors Insurance and Federal Disability Insurance Trust Funds. And the Medicare forecast can be read at the 2016 Annual Report of the Boards of Trustees of the Federal Hospital Insurance and Federal Supplementary Medical Insurance Trust Funds.
Social Security isn’t running out of money, and it is not going bankrupt, but the program will face a shortfall in 2034.
The Trustees now predict Medicare will exhaust its reserves by 2028, two years sooner than last year’s estimate.
There are manageable solutions to these problems, but action does need to be taken.
The full Forbes article can be read here.
Aging related issues and the relative positions of the presidential candidates can be read at Next Avenue, a web site produced by PBS.