This week, Facing the Future took to the road to Ball State University in Muncie, Indiana where The Concord Coalition’s national field director Phil Smith helped run our Principles and Priorities federal budget exercise with students and local community members, in coordination with the university’s Bowen Institute. It’s all part of our college campus events around the country happening this year to mark the 30th anniversary of The Concord Coalition’s founding.
In the exercise, participants are presented with many options to help put the federal budget on a more sustainable path. They work together in groups to cut or add spending, and cut or add federal revenue. They must then present their proposals, explain their reasoning, and assess whether or not these plans are politically feasible. Following the exercise at Ball State, Smith helped facilitate questions from the participants for a panel discussion addressing many of the challenges at the root of federal fiscal unsustainability.
Panelists joining me for this discussion were two national federal budget experts well known to Facing the Future listeners: Dr. Josh Gordon, the Director of Health Policy for the Committee for a Responsible Federal Budget; and Ben Ritz, Director of the Center for Funding America’s Future with the Progressive Policy Institute, or @BudgetBen as he is known on Twitter. Both Josh and Ben are former Concord Coalition staff members.
For Gordon, the path to sustainability must include reducing health care costs. That means using the power of the federal government to lower the cost of prescription drugs, or what providers are paid for Medicare and Medicaid, or perhaps even restricting access to more expensive medical treatments through prioritization factors.
“The health care programs are the largest chunk of the federal budget,” said Gordon. “They are projected to grow faster than the economy can keep up with for the long term, which leads to an unsustainable future that looks very much like the federal budget’s unsustainable future. The more we work, the more we produce as a country. Health care eats a bigger and bigger chunk of that over the long term. Our health care system is uniquely inefficient in using all of that money that we put towards it, especially when you compare us to basically every other developed country in the world that spends substantially less than we do both as a share of the economy and per person, and yet we get outcomes that are the same or worse than those other countries.”
Another major challenge to sustainable federal budget policy is Social Security, and Ritz strongly urged the audience, particularly the college students in attendance, to pay much closer attention to the program, because it will impact them directly.
“The policies we are putting in place now – or not putting in place now – will impact what kind of program we can depend on when we retire,” said Ritz. “We’re the ones paying into the system right now. Our payroll taxes are supporting the program, and as it’s currently structured, Social Security will become insolvent by 2034. Insolvency doesn’t mean that the program will just go away, but there is a gap between the revenues we are paying and the benefits being paid to seniors that’s about 30% of the program. That discrepancy is going to have to be addressed either with benefit cuts or tax increases. The longer we wait to do anything about it, the more that burden is going to fall on young people instead of being more evenly distributed across generations.”
Questions from the audience ranged from: whether or not Medicare costs could be saved by cutting down on fraud, whether Congress should do more to incentivize employers to match 401K contributions for employees in anticipation of declining Social Security benefits, to whether investments in health and wellness can result in a healthier population and reduce health care spending enough to make an impact on the budget for Medicare and Medicaid, or even facilitate increasing the retirement age for Social Security.
We are scheduling more of these panel discussions at college campuses across the country on our Facing the Future tour in 2022, and when possible you will get to hear some of those varied voices from young people all over the United States on our podcast.
Hear more on Facing the Future. I host the program each week on WKXL in Concord N.H., and it is also available via podcast. Join me and my guests as we discuss issues relating to national fiscal policy with budget experts, industry leaders, and elected officials. Past broadcasts are available here. You can subscribe to the podcast on Spotify, Pandora, iTunes, Google Podcasts, Stitcher, or with an RSS feed. Follow Facing the Future on Facebook, and watch videos from past episodes on The Concord Coalition YouTube channel.