The media is all abuzz today about a "stimulus package" President Bush wants Congress to pass. At the same time, today Glenn Beck interviewed David Walker, Comptroller General of the United States. Mr. Walker is the man who keeps the books for our country. Mr. Walker describes our country's fiscal situation in very scary terms.
According to Mr. Walker, we have 34 trillion dolllars more promised just in Medicare than we have revenue available to pay for it. Before Congress passed the Medicare prescription bill the hole was "only" 20 trillion dollars. 75% of our country's debt is owned by foreigners! In 1950 there were sixteen workers for every one Social Security recipient. Soon that number will be two workers for every one recipient!
According to Mr. Walker, this issue of fiscal responsibility is going to have to rise to the top of issues debated once we get to the general election. I think he is right, and I think the President and the Fed chairman are now proposing a short term band-aid that will not begin to deal with the hole we are in.
Update: Larry Kudlow comments on Bush's moves here.
2 comments:
I was looking at my pay stub just this morning and noticed that I had to put more in social security than I put in my 401k. And I'm contributing what I consider to be a lot (7%) to my 401k, in order to take full advantage of my company's match. Being 30 years out from retirement, I don't expect to ever receive social security. I wish I could put that other 8% in my own account (or even keep it to help the monthly budget) instead of giving it to the government.
I don't know what the solution is, but clearly the current SS system is not working due to increased life expectancies and decreased fertility rates. To many retirees, not enough worker bees. I mean no disrespect for my elders who are counting on SS for part of their retirement. They've planned for it and they can't just be cut off now. But maybe going forward people should just save for their own retirements. Isn't that how it worked for the first 19 centuries? I know many people would not save anything if SS wasn't taken out of their check as a tax, and then their poverty would just be an even bigger drain on society later on. We can't have a bunch of elderly people dying in the streets. Perhaps folks should be required to contribute to a retirement plan of some sort, but they should be saving for their own accounts, and making their own decisions on how to invest, rather than putting it all in the government's coffers and hoping the system will still be solvent when it's our turn to withdraw.
daddio,
You are showing way too much common sense. I don't know what we are going to do with you!
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