Skip to comments.73 percent of all federal income taxes needed to fund Medicare and Social Security entitlements
Posted on 07/23/2004 2:33:35 PM PDT by mft112345
A 72-trillion-pound elephant is in the room and we have a patriotic duty to acknowledge him before he devours our economy, crushes the quality of our health care and destroys our retirement security.
According to the 2004 Social Security Trustees report the unfunded long-term obligations of Social Security and Medicare amount to $72 trillion. The total bill for current and future taxpayers breaks down as follows: $21.8 trillion from Medicare Part A; 23.2 trillion from Medicare Part B; $16.6 trillion from the new Medicare prescription drug benefit; and $10.4 trillion from Social Security.
It's highly unlikely that either party will mention the $72 trillion figure in any of their 30-second-sound bytes, because there is no immediate political gain in raising the issue.
To put $72 trillion into perspective: On July 15, at a luncheon event in the Rayburn House Office Building of the U.S. Capitol, Social Security Trustee Thomas R. Saving told an audience that Congress would have to devote "73 percent of all income taxes from now until eternity" in order to pay for the two entitlement programs.
Repeating a warning from the 2004 Social Security Trustees report, Saving said these two programs are expected to consume 1/4 of all federal income taxes by 2019, and added that he doesn't expect Congress or the American people to allow this to happen. When I questioned him after his talk, he told me that he believes tax increases are inevitable if America decides to pay for these entitlements as they exist now.
Referencing the former Soviet Union, he questioned whether Americans would still be willing to work under the future tax burden. Jokingly, I asked him whether it was time to move to a different country, and he said every country is facing similar demographic problems.
America's patients, retirees and taxpayers can't afford to wait 15 years before politicians are brave and honest enough to confront this crisis. Voters ought to ask politicians to propose fair, reasonable and specific solutions to this $72 trillion dilemma.
Social Security private accounts are a necessary -- but small -- step towards fixing this problem. These individual accounts would not address the debt from the retirees who are in the system now or the 70 million baby boomers who might retire before Congress agrees to allow these accounts. As mentioned earlier, projected Social Security spending only accounts for $10.4 trillion, with more than $60 trillion coming from projected Medicare spending.
We should use any and every opportunity to ask candidates and office holders to discuss the $72 trillion figure mentioned in the Trustee's report. Political candidates should not be allowed to gloss over this issue, simply because it's a sensitive subject in an election year. America's taxpayers, patients and retirees can't afford to give them this luxury.
Life is perverse. After paying taxes all these years, I'm actually looking forward to living at the expense of all the liberal voters who think SS and Medicare are a great thing.
It looks like we are along for the ride. How you personally plan for this, I don't know because it will create instabilitly in a lot of investment vehicles.
Do you own investments without debt or do you have a lot of debt and know you can pay it back with inflated dollars???
The government will do what the government always does - deficit spend!
No problem--we'll just import some more of our South O' the Border compadres to pick up the tab.
"By 2050, when todays college students will reach retirement, [Social Security and Medicare] will consume more than three-fourths of all income taxes."
Title is a bit misleading. The report says by 2050 3/4 of the federal taxes will be needed to support this. I'm not suggesting that's not a horrific realization, but the title leads one to believe its now. There is serious doubt if the system will resemble what it is today by 2050.
Words for title came directly from the mouth of a Social Security Trustee, Tom Saving.
"On July 15, at a luncheon event in the Rayburn House Office Building of the U.S. Capitol, Social Security Trustee Thomas R. Saving told an audience that Congress would have to devote '73 percent of all income taxes from now until eternity' in order to pay for the two entitlement programs."
Let's hope it doesn't. Let's hope it looks better by then.
I hope we defeat the Islamofacists before we go totally bankrupt and cannot defend ourselves from Canada.
How much will the Bush prescription plan cost?
Well, if we had a consumption tax instead of an income tax, that would be a great idea.
The surprise for me is how little of the projected spending goes to retirement income payout and how much goes to medical care. 6/7ths is medical, while most people's nightmare is that their monthly Social Security check will not come.
It's time for a plan to wean the public off of Social Security and all the related handouts. When will the liberals (and those who we are not suppose to talk badly about on "our" side of the fence who act like liberals) realize that we just cannot afford their boondogle of a public welfare system? When they don't get any check at all - it ALL goes to the government? Oh wait, real liberals want just that.....work for Big Brother - and Big Brother will look out for us.....
END IT NOW....arrrggghhh...
If it's not too late....
At about the time our original 13 states adopted their new constitution, in
the year 1787, Alexander Tyler (a Scottish history professor at The
University of Edinborough) had this to say about "The Fall of The Athenian
Republic" some 2,000 years prior: "A democracy is always temporary in
nature; it simply cannot exist as a permanent form of government. A
democracy will continue to exist up until the time that voters discover that
they can vote themselves generous gifts from the public treasury. From that
moment on, the majority always votes for the candidates who promise the most
benefits from the public treasury, with the result that every democracy will
finally collapse due to loose fiscal policy, (which is) always followed by a
"The average age of the worlds greatest civilizations from the beginning of
history, has been about 200 years. During those 200 years, these nations
always progressed through the following sequence:
From Bondage to spiritual faith
From spiritual faith to great courage;
From courage to liberty;
From liberty to abundance;
From abundance to complacency;
From complacency to apathy;
From apathy to dependence;
From dependence back into bondage."
Professor Joseph Olson of Hamline University School of Law, St. Paul,
Minnesota, points out some interesting facts concerning the most recent
Population of counties won by:
Gore = 127 million
Bush = 143 million
Square miles of land won by:
Gore = 580,000
Bush = 2,2427,000
States won by:
Gore = 19
Bush = 29
Murder rate per 100,000 residents in counties won by:
Gore = 13.2
Bush = 2.1
Professor Olson adds: "In aggregate, the map of the territory Bush won was
mostly the land owned by the tax-paying citizens of this great country.
Gore's territory mostly encompassed those citizens living in
government-owned tenements and living off government welfare..."
Olson believes the U.S. is now somewhere between the "complacency and
"apathy" phase of Professor Tyler's definition of democracy; with some 40
percent of the nation's population already having reached the "governmental
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