Stop Blaming the Boomers
Over the last two decades, there has been an effort by the enemies of Social Security and Medicare to demonize the baby boomers as a threat to country's prosperity and the well-being of our children and grandchildren.
They have repeatedly warned of the enormous projected cost of Social Security and Medicare and called on the current or future elderly to sacrifice their benefits under these programs for the common good. We heard endless tales of $70 trillion dollar-plus deficits and how our children and grandchildren would face crushing tax burdens unless the greedy soon to be geezers accepted large cuts in their Social Security and Medicare benefits.
Those of us who challenged this story now have an important ally in Peter Orszag, the new director of the Congressional Budget Office. Orszag has made a point of distinguishing the extent to which costs are projected to rise due to aging and the extent to which they are projected to rise as a result of the rising cost of health care in the United States. As he recently said at a press event, "The long-term fiscal problem truly is fundamentally one involving the rate at which health care costs grow and much less about the aging of the population."
This is hugely important. The way to deal with scary long-term budget projections is to fix our health care system, not to gut Social Security and Medicare. While aging will impose some additional costs in the future, this is not new; life expectancies have been increasing ever since the United States came into existence. The new threat is a health care system that is projected to consume more than 30 percent of gross domestic product in just over three decades. If health care costs in the United States looked more like those in any other wealthy country, we wouldn't have to look at scary budget projections.
The moral of Orszag's analysis is that those who are concerned about the huge deficits projected for future decades should be working first and foremost on reforming the health care system. If we fix our health care system, then our other budget problems are manageable. If we don't fix the health care system, we can look forward to a future of bad health care and a weak economy. We will also have insoluble budget problems.