January 26, 2011

GUTLESS: No Leadership in Either Party

If you are 40 years old or younger, you will never collect a dime from Social Security. Odds are that you will not receive any benefits from Medicare, or Medicaid, either. All three entitlement programs will have collapsed into nothingness.

This is a mathematical certainty that neither the Democratic nor Republican speakers would address last night. President Barack Obama incredibly called for more spending in his second State of the Union Address, apparently learning nothing of the abject failure of his policies issued since his first SOTU.

Wonkish Paul Ryan could not bring himself to address the proximate pachyderms either in his Republican response to the President's address.

Social Security, Medicare, and Medicaid are dead men walking. They cannot be saved. Pretending otherwise, and letting the American people believe that entitlements go on forever is the greatest of disservices. It is poor consolation that neither party with survive the inevitable collapse.

Update: Social Security is officially broke. That took even less time than I thought!

Posted by Confederate Yankee at January 26, 2011 01:12 PM

I do not disagree with your premise, but your conclusion is not supported.

There are several half-measures that could save SS/med/Med. They all involve some measure of paying out less than current benefit levels. Once you move the bar, moving it again becomes easier. No doubt, the programs as we have known them will not survive, but something smaller witht eh same names and tax structure will.

As long as people work, there is a revenue stream through payroll taxes to pay some level of benefits.

1. As always, they will start with the rich, because they will squeal the least when stuck. Anyone with independent means will be excluded from collecting benefits. Middle class will collect smaller benefits and the bulk of the payments will be reserved for the indigent.

2. Changes to kick ne'er-do'wells from the rolls of SSS. Stop making disability payments to drunks and addicts.

3. Changes to med/Med to cover fewer things and for fewer people.

The math is not impossible.

Posted by: Professor Hale at January 26, 2011 01:23 PM

The problem with math based solutions is political. To start means testing is to admit that it's welfare and not some sort of pay in pay out pension program.

I fully believe that it will collapse, and I think it will happen before the actual financial collapse. Gen X (my generation) has never believed that SS will pay us a dime. We realized this long ago, and our actions show it:

The butthurt is going to come when Gen X has more political clout than the boomers, who are likely to be living on SS when it happens. That's when Gen X is going to just close the tap and scrap the whole thing. Why would we continue to pay into a system that won't be there for us when it's our turn? Means testing will absolutely come then, because the boomers will have to make do or go to traditional welfare.

Posted by: Phelps at January 26, 2011 02:20 PM

I am 59. I doubt that I will ever see a dime of SS. I have a small municipal gov't pension. SS will cut my SS because of it even though I payed in for years. It has been a ponzi scheme from day one.I say phase it out.
In 1965 LBJ and the Democrats started taking the SS tax and using it to pay the regular budget. When the Republicrats were in power they could not resist either. Now the chickens are coming home.

Posted by: harp1034 at January 26, 2011 03:55 PM