Monday, April 23, 2012

Social Security and Medicare Sliding Closer to Insolvency

We're in the very best of hands.

No problem here, none at all.

At the Los Angeles Times, "Trustees warn of looming insolvency for Social Security, Medicare":
WASHINGTON - The nation's Social Security and Medicare programs are sliding closer to insolvency, the federal government warned Monday in a new report underscoring the fiscal challenges facing the two mammoth retirement programs as baby boomers begin to retire.

Medicare, which is expected to provide health insurance to more than 50 million elderly and disabled Americans this year, is expected to start operating in the red in its largest fund in 2024, according to the annual assessment by the trustees charged with overseeing the programs.

And the Social Security trust fund, which will provide assistance to more than 45 million people in 2012, will be unable to fulfill its obligations in 2033, three years earlier than projected last year.

“We must take steps to keep these programs whole for the future,” Treasury Secretary Timothy F. Geithner, the senior trustee, told reporters Monday.

When the Social Security and Medicare funds are exhausted, they will still be able to pay benefits because they will continue to collect tax revenue. But the deficits would probably force major cuts.

The dismal outlook was fueled in part by the sluggish economy, which has slowed growth in payroll taxes that sustain the trust funds, according to trustees, who include Cabinet secretaries and two public representatives.
More at the link.

Meanwhile, absolutely nothing will be done on entitlement reform, especially with Democrats in power. We might possibly see movement toward reform with a Romney administration and unified GOP control of Congress. And even that's longer odds than the slots at Vegas.