August 16, 2010

Medicare and Social Security Are Unsustainable

Government is boasting that with the new health care legislation enacted, Medicare's funding is in better shape than ever, able to last a dozen years longer than anticipated.

Nonsense, says Michael F. Cannon of the Cato Institute. At Cato @ Liberty he writes that "the Medicare and Social Security 'trust funds' contain zero funds."

This is not up for dispute. When those programs' revenues exceed outlays, Congress puts the excess in general revenues and spends it. Congress marks the event by leaving an IOU to itself in these "trust funds." Those IOUs are not "funds," any more than an IOU that you write to yourself is money. These so-called "trust funds" therefore have no bearing on the (in)solvency of Medicare and Social Security.

Yet every year, the trustees for these programs claim that they do, making the Medicare and Social Security trustees reports an annual, ritualized lie that the U.S. government broadcasts to the American people.

No matter the president's wish of preserving Social Security forever; no matter the Democrats' wish of turning America into a social democracy where every citizen is properly cared for from birth to death, massive entitlement programs like Medicare, Medicaid and Social Security are, in the long run, fiscally unsustainable and always, immoral, because they are designed to give money to those in "need" at the expense of responsible citizens who could otherwise perfectly take care of themselves. They should be phased out and eventually, abolished.

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