Purcell: ‘Cliff’ not our real crisis
Ryan Summerlin January 8, 2013
Washington’s self-created “fiscal cliff” crisis has been somewhat resolved, which means we can continue ignoring the real fiscal crises that are dead ahead.
Medicare offers a fine example.
The Medicare mess began in 1965 when Lyndon Baines Johnson continued FDR’s tradition of buying votes with the voters’ own money: That’s when LBJ signed Medicare into law.
Medicare actually worked well for many years – when there were lots more people paying into the insurance program than there were Americans over 65 using it.
But, like most government programs, Medicare was too good to last. There are four reasons why.
First, old folks don’t croak anymore – or at least live longer. They are happier and healthier than ever before, as anyone would be who doesn’t pay local taxes and gets free coffee at fast-food joints. But many of them receive Medicare, which is costly.
Second, new medical technologies are expensive, which drives up Medicare costs. These technologies are keeping people alive, which is terrific, but that has the effect of further driving up Medicare costs.
ObamaCare is killing technology companies’ incentive to keep inventing life-saving devices – it places a 2.4-percent tax on gross revenue, which equates to a massive 15-percent tax increase on profits – but that is another story for another time.
The third reason Medicare costs are soaring has to do with medical inflation, which has risen dramatically over the years. This inflation is partly due to the government pumping billions into the medical system via Medicare.
That’s right, Medicare has helped drive up the cost of Medicare.
The fourth reason is the biggest driver of soaring Medicare costs: Baby boomers are retiring in big numbers. Today, about 48 million Americans are enrolled in Medicare. That number will jump to more than 80 million.
This year, the federal government will spend just over $600 billion on Medicare. That number accounts for 60 percent of the federal deficit now. It will jump to $1 trillion by 2020 and continue to soar from there.
In 1965, there were nearly five workers paying into the system for every person receiving benefits. Today, there are only three workers paying in for every person taking out – a ratio that will drop to 2-to-1 in 2030 when millions of baby boomers are enrolled in the system.
We are unable to meet our current obligations and are coming up $1 trillion short every year. How on Earth are we going to meet future Medicare obligations that are growing by leaps and bounds?
Yet most of our political leaders, in particular our president, have not done a whit to address this very real problem.
During his first term, President Obama established the Simpson-Bowles commission to identify non-partisan solutions to our debt and deficit crisis – our real crisis – and then promptly ignored it.
The president and Congress took us through this fiscal-cliff nonsense without touching the elephant in the room.
So here we are, stuck on stupid, headed for certain disaster, and nobody is doing a thing to get Medicare under control before it and the other entitlement programs sink us all.
You’d think that when a person casts a vote for a particular political leader, the voter would demand that the leader lead – but only a minority of American voters have any idea how frightening our financial situation is.
And you’d think that leaders would willingly accept a crisis they are presented with during their time in office – but our president is choosing to ignore the real one he is facing.
That is the real crisis.
Tom Purcell, author of “Comical Sense: A Lone Humorist Takes on a World Gone Nutty!” and “Misadventures of a 1970’s Childhood,” is a Pittsburgh Tribune-Review humor columnist and is nationally syndicated exclusively by Cagle Cartoons syndicate.