Social Security and Medicare finances worsen

Social Security and Medicare finances worsen

seattletimes.nwsource.com

The financial health of Social Security and Medicare, the government's two biggest benefit programs, have worsened because of the severe recession, and Medicare is now paying out more than it receives.

Trustees of the programs said Tuesday that Social Security will start paying out more in benefits than it collects in taxes in 2016, one year sooner than projected last year, and the giant trust fund will be depleted by 2037, four years sooner.

Medicare is in even worse shape. The trustees said the program for hospital expenses will pay out more in benefits than it collects this year and

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[edit on 5/12/2009 by semperfortis]

Wonder how the administration will handle this issue. Considering that the trust fund isn't even backed by anything other that paper that the US govt guarantees, and we would need to go out and borrow even more money to spend from it, we are in a bad position. China already is buying less of our debt, so is Japan. The federal reserve is increasingly needing to buy our own debt through printed money.

Only solutions are more borrowing, more printing (which will hurt borrowing and cause even more inflation), or much higher taxes. Of course or some combination of all of them. Point is, the social entitlement program as we know it won't be here for much longer. Our country is nearly bankrupt before this, this could push us over the edge. Thats all assuming there isn't a commercial real estate crash.

seattletimes.nwsource.com
(visit the link for the full news article)

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[edit on 5/12/2009 by semperfortis]

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