The 2016 reports from the Social Security and Medicare trustees confirm again that these critical programs are on unsustainable paths and will put increasing pressure on the rest of the federal budget in the years ahead.
“The trustees do not issue these reports for their own amusement,” says Robert L. Bixby, executive director of The Concord Coalition. “The annual reports are required by law with the expectation that responsible lawmakers will heed their warnings and take appropriate action.” But for several decades, he adds, “that has been a vain hope.”
The reports say Social Security and Medicare Part A (Hospital Insurance) continue to pay out more than they take in from their designated payroll taxes and thus rely on some general federal revenues. General revenues also help support other parts of Medicare.
The trustees say general revenue subsidies for Social Security and Medicare will total $401 billion in 2016 — $328 billion for Medicare and $73 billion for Social Security.
Bixby notes that the presumptive presidential nominees of the major parties “have yet to propose anything to deal with the problems highlighted by the trustees’ reports.”
A 2014 report by former U.S. Senators Bob Kerrey and Jack Danforth updates earlier work by a bipartisan commission they headed and provides helpful perspectives for entitlement reform. They are now two of Concord’s co-chairs.
“Failure to act soon could jeopardize our economic future, undermine our standard of living and unfairly burden our children and grand-children with excessive government debt,” Danforth said in response to the latest trustees’ warnings.
Kerrey added: “What this means is that current law will not allow Social Security to keep the promise to every future beneficiary under the age of 50. The longer Congress delays, the larger the cut in future benefits or the increase in future taxes.”