During the State of the Union address Tuesday night, President Biden said, “some Republicans want Medicare and Social Security to sunset.” That prompted cries of “no” from GOP members of the Senate and House.
Biden then responded, “As we all apparently agree, Social Security, Medicare is (sic) off the books now.”
That comment triggered a bi-partisan standing ovation. “We’ve got unanimity!” The President exclaimed.
That moment is a perfect example of what is wrong with our government. Social Security and Medicare—two historic and cherished entitlement programs—should be at the very forefront of what Congress and the President must tackle. Instead, the abdication of responsibility is treated as an applause line.
Both programs are rapidly headed toward a financial cliff. Here are the latest findings from the Social Security and Medicare Trustees:
–Social Security will have enough money to pay full retirement and survivor benefits through 2034. After that, the surplus will be exhausted, and Social Security tax collections will fall short of obligations.
–Medicare Part A, which pays for in-patient hospital care, will be able to pay scheduled benefits only through 2028. Beyond that, reserves will be depleted and income will only be sufficient to pay 90 percent of benefits.
What happens when these programs cross their financial Rubicon if nothing is done? The short answer is benefits to individuals on Social Security will be reduced and hospitals will receive even smaller reimbursements for Medicare, which will affect care and cause even more cost shifting.
There are options. The non-partisan Committee for a Responsible Federal Budget reports, “Numerous bipartisan commissions and experts have studied Social Security and determined restoring solvency will likely require a mix of revenue and benefit adjustments.” That includes things like raising the retirement age and lifting the payroll tax cap.
On Medicare, the Committee reports most of the options include “lowering the cost of health care.” Good luck with that! Medical costs vary from year to year, but the average annual increase over the last 20 years is about five percent.
Nobody in Washington wants to touch these issues.
“Both (Barack) Obama and (George W.) Bush made serious attempts,” Doug Holtz-Eakin, former economic advisor to President George W. Bush, told the Washington Post. “That appetite has completely disappeared in the past decade.”
Not only has it disappeared, but when the President of the United States says on the largest political stage that the issue is off the table, everyone stands up and cheers! They are thinking about the next election, not about the pending threat of insolvency.
Our politics are increasingly polarized, making it difficult to reach bipartisan agreements on big issues. However, it is even more troubling when the one thing they can agree on is doing nothing about Social Security and Medicare.