If you have a pulse you know that presidential election season is now in full swing. News headlines follow every poll and gaffe that the candidates make. While it might seem exhausting keeping up with this all, there is also some good that comes out of it, solutions to lingering problems get discussed and analyzed and even debated. This is to the benefit of the voters and the American constituents at large. New ideas and solutions have the chance of becoming law and making meaningful change to solve our nation’s problems. Without this coverage, these issues would go largely unnoticed.
One issue that has not seen the type of coverage that it deserves is entitlement reform. Entitlements such as Medicare, Medicaid and Social Security continue to be vital programs to beneficiaries and continue to create larger and larger spending problems. Last year, 66 percent of federal spending was dedicated to entitlements and servicing the national debt. From 1994-2014 mandatory spending, including Social Security and entitlements, doubled. The numbers just continue to rise and have no end in sight. With more and more Americans retiring every day, more and more are also enrolling in Social Security and Medicare. To add insult to injury the Social Security Disability program continues to move into worse fiscal shape with historic enrollment and low-labor participation rates to pay for the program. The Social Security program is only solvent until 2034, and the disability insurance program could be insolvent as early as the end of next year. New studies reflect that these numbers are generous at best. Both Harvard University and Dartmouth College have published research that looks at the Social Security Administration’s actuarial forecasts and found that the forecasts have been consistently overstating the financial health of the program’s trust funds since 2000. Long-term solutions to reform these programs are in dire need of attention and meaningful reform must closely follow this attention.
When politicians have addressed these issues in the past, they point to popular reforms like raising the retirement age and means testing Social Security and contend these reforms will solve all the programs’ ills. Before politicians engage in large structural reforms that take away benefits, elected officials and candidates need to first create more transparency in the program. Some common-sense ideas that a majority of voters, and more importantly seniors support, are locking Social Security and actually funding the program with taxes collected for the program. These two reforms would do what most people think already takes place with Social Security, which is people think the system is funded by the funds taken in by payroll taxes, but instead benefits are really paid by redeeming treasury securities and borrowed money. Instead of robbing Peter to pay Paul, Social Security FICA taxes would be segregated in an account and only used to pay benefits. Right now the government spends FICA tax money on other programs, by locking this money away unfunded liabilities for the program would improve and would have the effect of reducing the amount it had to borrow from the public, which includes foreign investors.
For too long politicians have borrowed money more than our government takes in through tax revenues. Likewise, we have a national debt that is negatively impacting the vitality and health of our country. In the event that the Social Security Trust Fund runs dry, benefits will have to be cut, or taxes will need to be raised, changes that few people want. Taxpayers deserve better and need serious leaders with ideas that can be implemented to restore the fiscal health of our nation.