Friday, February 22, 2013

The "Delay" Tax

Everyone knows, except Obama, that the entitlements are $70 trillion in the hole from an actuarial point of view.  This means that, in finite time, they will run out of money.

So that, it is very, very clear that future generations will get nothing at all from social security and medicare regardless of the amount that they pay in. Unless something is done.

This we know (except for Obama, of course, who seems to know nothing).

All of this means that sooner or later, social security and medicare will be fixed.  Running out of money is a fix. That does solve the problem.

A simple solution is to move out the age of eligibility for medicare (and index it).  Do the same for social security.  Means test both programs.  Raise medicaid eligibility requirements.  Doing these things would mean that social security and medicare will never run out of money.

So, a simple fix, can make things work.  If we do it now.  Delay means that when you do act, the actions must be much, more draconian.  By postponing action, even for only a single year, the size of the cuts and the postponement of eligibility must be far greater than what would be necessary if we acted today.

This is the Obama "delay" tax.  The longer you postpone dealing with the problem, the worse is the plight of future seniors.  Either Obama doesn't know this (which is probable, because he isn't very focused on real issues) or he knows it and simply doesn't care.