Tuesday, May 11, 2010

Social Security is the low hanging fruit

Brief article noting that fixing social security is lots easier than fixing the deficit problems related to health care. The reason Social Security is lots easier to fix is that its benefits are indexed to inflation (in one way or another; some of the fixes would change the indexing), while health care costs routinely go up 2 or 3 times faster than overall inflation. Medicare (and Medicaid to a lesser extent) both contribute to this state of nature, and also are affected by it. The long term deficit problem is primarily a Medicare and Medicaid problem. The reform just passed lays the basis for being able to address this issue, but the critical question is what are the next steps? What will come next to move us toward a sustainable health care system, and therefore a chance at a sane federal budget.

If the President's deficit Commission did nothing more than propose a fix for Social Security, a capping of the tax exclusion of employer paid insurance, and raising the Medicare eligibility age to put it in line with the Social Security age, that would be a good start. If all they could agree on is a fix of Social Security, then fine.

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