It seems these days lawmakers are spoiling for a fight on just about every issue, but there’s one topic few want to even bring up: Entitlements — the political time bombs ticking louder as time goes on.
According to the trustees, Social Security benefits will become insolvent – or “bankrupt” in common language – by 2035. Medicare runs out of cash much sooner – by 2026.
“Social Security entirely and Medicare to a smaller extent are affected by so-called Federal Trust Funds, so when those run out there is a shortfall in what they promised to pay in benefits versus what they are able to pay based on the revenues they’ve collected,” Romina Boccia, research fellow at the Heritage Foundation told CBN News.
That DOES NOT mean the payout will disappear entirely, but cuts are likely.
So how did we get here?
Social Security came out of the Great Depression and Medicare from President Lyndon B. Johnson’s Great Society campaign.
“During the Depression, of course, the banks were closed. Retirement savings had been wiped out, people didn’t have jobs so there was a great deal of need to take care of seniors,” explained Michael Tanner, a senior fellow at the CATO Institute.
Tanner literally wrote the book on entitlements and says when it comes to Social Security the country changed, not the program.
“The problem is this was never a savings program. When you pay your Social Security, that money is not put away for your retirement it is simply transferred for people who are already retired today, and then you hope the next generation pays benefits in for your retirement, very much like a pyramid scheme,” Tanner began.
Click here to read more.