Entitlements run amok

Discussion in 'Politics' started by red states rule, Jul 11, 2007.

  1. red states rule
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    red states rule Senior Member

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    Government wealth transfers are growing, and the Dems are wasting time with investagations and appeasement

    The amount of money needed to fund entitlements is numbing

    snip


    Actuaries and trustees express these unfunded obligations in present-value dollars. Thus, when Social Security's Chief Actuary projected this year that Social Security's 75-year unfunded obligation was $4.7 trillion, this indicated that if an additional $4.7 trillion had been added to the trust fund at the beginning of 2007, the program would have had adequate financing to meet the projected cost of benefits scheduled in current law over the next 75 years. However, the U.S. Treasury must also find an additional $2 trillion to redeem the bonds presently in the Social Security trust funds. Thus, the real-world Social Security present-value unfunded obligation over 75 years is actually $6.7 trillion.

    "Because the deficits for Social Security continue to increase beyond the 75-year horizon," John Palmer and Thomas Saving (the two public trustees) explain in their 2007 report, "the magnitude of the fiscal problem over the very long run [i.e., the infinite horizon] is much greater than the 75-year picture conveys." As a result, Social Security's present-value unfunded obligation over the infinite horizon is $15.6 trillion (including the need to redeem today's $2 trillion in trust-fund bonds).

    Medicare, which includes hospital insurance (Part A), outpatient services (Part B) and prescription drugs (Part D), is in far worse shape than Social Security. The present-value unfunded obligation over 75 years for Part A is $11.6 trillion. That is what would have to be added to the virtually depleted hospital insurance trust fund at the beginning of 2007 to meet the projected cost of current-law expenditures through 2081. For Part B and Part D, the 75-year unfunded obligations are $13.9 trillion and $8.4 trillion, respectively. For all of Medicare, the 75-year unfunded obligation totals $33.9 trillion. Including the $6.7 unfunded obligation for Social Security, the total 75-year present-value unfunded obligation for both entitlement programs is $40.6 trillion.

    As explained in the official 2007 Financial Report of the United States, which is issued each year by the U.S. Treasury Department, "The shorter [75-year] horizon understates financial needs by capturing relatively more of the revenues from current and future workers and not capturing all of the benefits that are scheduled to be paid to them." This explains the need for the infinite-horizon estimates. At the beginning of 2007, the present-value unfunded obligations over the infinite horizon for Medicare's three programs total $74.3 trillion: Part A (hospital insurance), $29.5 trillion; Part B (outpatient services), $27.7 trillion; Part D (drugs), $17.1 trillion.

    Thus, Medicare's present-value infinite-horizon unfunded obligation of $74.3 trillion is nearly five times Social Security's $15.6 trillion. Together, they total $89.9 trillion.

    http://www.washingtontimes.com/apps/pbcs.dll/article?AID=/20070711/EDITORIAL/107110013/1013
     
  2. William Joyce
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    William Joyce Chemotherapy for PC

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    Sadly, it's a problem too big for anyone to care about, or have any influence on. Democracy is kind of like that rat in the experiment who could dose himself with narcotics by pressing the lever in his cage. He kept doing it until he died. We vote for increases in entitlements until the system melts down. We won't ever stop.
     
  3. Angel Heart
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    Angel Heart Conservative Hippie

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    The system is exactly why we are going to safe for our retirement. I refuse to depend the 'system' to do it for me.
     
  4. red states rule
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    red states rule Senior Member

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    Which is exactly what libs do not want you to do. If you are not dependent on the government for your retirement - why would you need the Democrats?
     
  5. JeffWartman
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    JeffWartman Senior Member

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    Republicans love pork and entitlements just as much as the Democrats do.
     

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