Inside Track
Baby Boomers Bring Budget Bust
The gargantuan Medicare and Social Security entitlement programs, with some tweaks along the way, remained more or less workable as long as the baby boomers were in the workforce — a large generation supporting smaller generations of retirees. Beginning this year, however, the boomers are going to start turning 65 at the rate of 10,000 a day for 19 years. With that milestone for this gigantic generation come enormous costs for the American taxpayer in the form of Medicare benefits, which begin at age 65, and Social Security benefits, which begin in full at age 66. As David Walker, former U.S. Comptroller General and CEO of the Comeback America Initiative, told CBS News, “The retirement of the baby boom generation will bring a tsunami of spending that will cause a severe problem for the federal government’s budget over time” — as if it didn’t have severe problems already.
For Medicare, says CBS News:
• The number of people eligible will nearly double from 46 million to 80 million by the time all the boomers reach 65.
• It’s estimated the cost will grow from $500 billion a year today to $929 billion by 2020.
• The number of workers supporting each senior will fall.
All of this adds up to one gaping hole in the federal budget. Medicare’s unfunded liability runs as high as $38 trillion over the next 75 years — ObamaCare does nothing to remedy this and will probably worsen it — and the program may go bankrupt by 2017. Social Security faces a $5.3 trillion shortfall over the next 75 years and has already begun cashing in the federal IOUs in its phantom trust fund. Former Treasury Department economist Bruce Bartlett calculated in 2009 that “federal income taxes for every taxpayer would have to rise by roughly 81% to pay all of the benefits promised by these programs under current law over and above the payroll tax.”
JBS Member or ShopJBS.org Customer?
Sign in with your ShopJBS.org account username and password or use that login to subscribe.
Subscribe Now
- 24 Issues Per Year
- Digital Edition Access
- Exclusive Subscriber Content
- Audio provided for all articles
- Unlimited access to past issues
- Cancel anytime.
- Renews automatically
Subscribe Now
- 24 Issues Per Year
- Print edition delivery (USA)
*Available Outside USA - Digital Edition Access
- Exclusive Subscriber Content
- Audio provided for all articles
- Unlimited access to past issues
- Cancel anytime.
- Renews automatically