• The Heritage Network
    • Resize:
    • A
    • A
    • A
  • Donate
  • Morning Bell: Preventing Generational Theft

    In the past 12 months the Bush Administration, the Obama Administration, and the Democrat controlled Congress have laid out $1.2 trillion in the name of stimulus, $700 billion for the Troubled Assets Relief Program, and over $400 billion for the Omnibus spending bill in debt on future generations of America. As big a hole as all that deficit spending has already put us in, the long term entitlement spending explosion is just as much of a fiscal threat, if not worse. As President Barack Obama said Tuesday, “The biggest problem we have long term is Medicare and Medicaid.”

    Just how bad is just the Medicare problem? In 1985, Medi­care drew only 0.4 percent of GDP ($17.9 billion) from the general fund to cover its excess costs. Ten years later, this had increased slightly to 0.5 percent of GDP ($37.0 billion). By 2007, Medicare’s draw had more than doubled to 1.3 percent of GDP ($179 billion). Going forward, Medicare costs are projected to more than triple from today’s 2.7 percent of GDP to 9.4 percent by 2050. In current terms, a cost increase of 6.7 percent of GDP would equal $916 billion, or $7,930 per household annually. According to CBO, if the entitlement growth was funded by issuing debt, the debt-to-GDP ratio would rise from about 37 percent today to more than 290 percent in 2050. If entitlement growth was funded by raising taxes, CBO analysis indicates that income tax rates would nearly double from current levels.

    To his credit, President Obama did include some minor Medicare cost containment measures in his budget, including “competitive bidding” for Medicare Part D, “pay for performance” for health care providers, and increased premiums for prescription drugs. But as Heritage scholar Bob Moffit explains, the devil is in the details for all of these containment measures and similar efforts by President Bill Clinton in 1993 had little success. This Congress in particular has a terrible track record of following through on Medicare cost containment measures.

    Minor modifications to Medicare’s administrative payment system will fail to save future generations from an avalanche of Medicare debt. Only fundamental reform of Medicare can contain costs and avoid economy killing debt and taxes. Conservatives have strong ideas on how best to achieve these savings including: 1) leveling the health care playing field by removing or capping the subsidy for employer-sponsored insurance; 2) changing Medicare financing from defined benefit to defined contribution; and 3) phasing out the Medicare subsidy for upper-income seniors.

    These are some of our ideas, but we do not have a monopoly on them. Today, at 11:15 AM, Senator John McCain (R-AZ) will speak at Heritage about his ideas for reigning in runaway federal spending. You can watch this event, “Generational Theft: The Fleecing of America’s Childrenhere.

    Quick Hits:

    Posted in Ongoing Priorities [slideshow_deploy]

    19 Responses to Morning Bell: Preventing Generational Theft

    1. Dennis A. Social Cir says:

      Obama is still pushing for socialized medicine. Once this happens the health care system will be horrible. The doctors will have their salary set by the "guvernemnt" and will be paid the same if seeing one or 100 people. The age of the patient will also play a part in what kind of treatment is offered for giving life.

      I agree health care cost is soaring, but socialized medicine is not the answer. I had a conversation with a doctor that is employed by the "guvernement" and was told if people really want to see "socailized" medicine just go to Cuba and see how well it works. Obama has staed a helath board will be in place to controll the cost. I guess this means they will also determine waht teatments will be offered.

      Oh well he is the "chosen one" with all the answers.

    2. Ozzy6900, CT says:

      Medicare is on the rise because the "baby boomers" are coming of age. The entire Social Security and Medicare system is going to collapse under the strain of trying to support the number of retirees that will be coming over the next five to ten years. the Bush Administration tried to address this problem and was shot down. Good plan or not, the problem needs to be addressed!

      As far as Senator McCain speaking on the issue, I think that Senator McCain will again prove himself to be more of a Liberal than the Conservative he is trying to make himself out to be.

    3. Richard Cancemi, Arl says:

      Admittedly, medical care aid for the elderly is costly; but, as an elderly person myself, I become incensed at all the complaints re. tax dollars supplementing my health care!

      If the Government would stop wasteful spending in all its intrusive social engineering programs and its give-away programs to foreign countries and the United Nations, not to mention its own bloated, and still growing agencies, there might be money available for the elderly who have supported this country over the years.

      Charity begins at home. But, alas, The hypocrites in Washington do not care about that!

    4. Ken Jarvis - Las Veg says:

      2 Things today.

      1. The HF and other Medicare Opponents fail to mention


      They make it sound like it is Tax $$$ supported.

      NOT SO.

      2. HF continues to Downplay support for Climate Change


      this Saturday nite.

      I wish someone would tell me.

      The HF should start a Forum

      as a place for US to discuss issues they raise.

      That way we could talk about what some think is -

      Socialized medicine

      and Health Care Costs.


    5. Ken in Santa Barbara says:


      Expand your facts on Bush addressing the Social Security and Medicare system problems. I don't have a clue. Are you speaking of the privatization?


    6. Dorothy Morgan, Okla says:

      Heritage Foundation could publish the facts on the prescription plan for Medicare….how it came about and how expensive it is for the budget. I think that is the item that began to blow up the costs of Medicare..and the recipients don't appreciate it….too expensive for them and the budget. Generally thought of as outlandish; big Pharma is thought of as another AIG rip off.

    7. Rhonda, Texas says:

      It's not medicare that is breaking the budget it's the illegal aliens that come here and use our medical resources to the point of bankrupting the country. Medicare recepients paid their share how much have the illegals paid for their medical care here? Just look at California, what is putting their state into bankrupcy? ILLEGALS!!! Until we solve that problem we're going to punish our seniors!!! Something is terribly wrong with our government. Let's reward people who don't pay taxes and punish the ones that do. It's all about the vote.

    8. Russell Bruce Moncri says:

      Congress is willing to spend over 1 Trillion dollars for "stimulas". I have read that 6 banking/finance institutions underwrite 80% of the credit card debt in this country which totals about 1 Trillion dollars.

      I would like to see what the "Think Tank" people would say the effect of using that money to pay off the outstanding credit card debt for those consumers who which to participate.

      Consumers who which to partake of the payoff must be willing to distroy all their current credit cards and opt out of future credit cards for a period of time,(ie 5 years)

      This puts money in the hands of consumers to enable them to sustain themselves better and pay their other obligations, including mortgage payments thereby decreasing foreclosure problems.

      Current penalties on credit cards exceeds 2 Billion per year.

      This creates stimulis from the bottom up where it is needed and where it will show the quickest results. The stimulis from the top down serves to only create more Gov. control and little finds it way to the grass roots where it is needed and offers little long term relief.

    9. rebecca kaminski says:

      The real theft is how this site misleads.

      It's shameful.

    10. Amber, Kansas City says:

      On the budget, all I can say is: join a TEA PARTY somewhere and get busy making noise. We aren't going to get this done any other way. Now is not the time to sit by and think "this doesn't affect me" — IT DOES. Oh, it does. Maybe not today–maybe today you still have your job and your insurance and life is good. But tomorrow when the $13 a month tax credit turns into another thousand you owe in taxe for the year… when you can no longer afford to pay your energy bill because first it doubled, and then it tripled… well, then it'll affect you but it will be too late!

    11. mike, hickory, nc says:

      "To his credit, President Obama did include some minor Medicare cost containment measures in his budget, including “competitive bidding”.

      "…competitive bidding"!?

      My, oh my. "They have eyes, yet they do not see; they have ears, yet they do not hear".

      It has happened before, but not quite like this time, that this writer and numerous others have seen signs of writers of hf articles (including the one in this case entitled "How to Prevent Generational Theft") in which they write as if they are either consciously or unconsciously trying to "have it both ways", as the saying goes, as they either drive directly or swerve into the Left's "divide and conquer" efforts to mislead everyone and cause us Conservatives to end-up arguing over how to “shave and primp the surface” while Leftist government elitists and statists are "robbing the store and the bank" and stealing us all blind of our freedoms, resources, and security.

      "The devil's in the details" of what Obama and his Leftist government elitist and statist Comrades are claiming and doing, that’s true!

      Indeed they are again showing and proving, as repeatedly shown and proven by history to this day, how the solutions for us, the people, and our freedoms, resources, and security against such elitist and statist antics and machinations has not ever, is not ever, and shall not ever be found in our settling for letting them cause us to "shave and primp" the surface of their elitist and statist ways, instead of going "all out" to defeat them (which is exactly what they are now doing to us), and thus save our freedoms, resources, and security from them and restore our place as what Ronald Reagan described as "the last, best hope of mankind".

      In fact, that requires our returning to and sticking with our now Conservative founding principles and documents of freedom and limited government, which made America free and great, in order to stop the Left's robbing and burying of our current and subsequent generations under their massive and wildly increasing spending, deficits, and debt, in the only way we can really do so and that is by our voting Pelosi, Reid, Obama, and their Comrades out of office as soon as possible, and keeping them and those of their ilk out of office.

      Otherwise, once again, such government elitists and statists will continue to prove what countless immigrants have already said and continue to say “Americans don’t see and appreciate the freedoms they have, and evidently won’t until they’re lost to government, and then it will be too late”, and “I came here (to the U.S.) to be free of such government control which has already been tried and has failed everywhere. Now where to I go?”

    12. mike, hickory, nc says:

      Correction: "It has happened before, but not quite like this time, when this writer and numerous others have seen signs of writers of hf articles (including the one in this case entitled 'Preventing Generational Theft')…"

    13. michael hutchings says:












      FREE WORK;









    14. ella quinn kinston n says:

      I think mccain will prove to be more to the left again.Amber you are right we do need to make a lot of noise.All of us need to get involved.

    15. dave mcduffie, lagun says:

      You folks have it all wrong. It is not the surge of babyboomers putting the SS system into bankruptcy, it is simply the fault of persons in government, politicians and ELECTED ones at that, who took an oath to protect Americans and instead sold us down the river. Literally gave away trillions of our hard earned dollars to other countries, to immigrants, legal and illegal, just to make a name for themselves. Lets specifically mention Ted(who let Maryjo Kopeckne drown)Kennedy, who gave away our social security funds to illegals and at the same time destroyed our health care system by making us pay, again for illegals, for druggies and alcoholics because of their "disease", and for aids patients who blatantly refuse to use condoms. By the way, is this crook dead yet? And now we have the supersocialist Obama, forced upon us by Mr George Soros and the entire socialist news network in this country, which refused to even acknowledge that Obama is a full fledged Marxist, who has no business being the president of this country or any other. He is totally without experience, knowledge, principles, I mean come on people, he was born in Kenya, is a Kenyan and will run this country just like a Kenyan. No go look at Kenya and tell me if you want to move there. Guess what! You do not have to move, you are now there! In Africa they kill white people(because they are white!) and they take their land, then wonder when the crops will just spring forth. Thank you American news media! The thing you are not, is AMERICAN.Folks, which country are you ready to move to? Seriously, better pick one because time is running out on us all.

    16. Will, Henderson, NC says:

      Even Medicare Med. costs can fall if:

      The judicial system punishes ambulance-chasing attorneys; fine or jail the originators of frivilous malpractice lawsuits, including the parasitic attorney, etc. Then the excessive malpractice insurance paid by doctors and hospitals would fall. And if it didn't, find out why and fine the heck out of the insurer. Also, doctors who commit fraud (i.e. calling for unnecessary exams and billing Medicare).

    17. Ron, Derry NH says:

      This so sinister it is almost amusing. One expands government expenses in tough economic times, increasing debt, spreads the wealth to those not adding to the productivity, increasing debt,involves the government into private business without the use of court structures/procedures that are in place such as chapter 11, increasing controls, start imposing income limitations and throw in a clause for competitive bidding in one small effort to show sympathy for free market procedures,but confine them to a government process, another control and this is all deemed good.(run on sentence to make a point!)

      Good for oppression at our own expense led by our imagined salvation by a charismatic soothsayer. American politicians are stealing from their own young to promise today's salvation with a systematic stripping of choice, liberty and self destiny to insure their further expanse of their power, not ours.

      The American workers power and liberties stem from his financially marketed worth based on his/her self made value offered into an open system based on competitive values not hinged on the governments structured will. When you can no longer withdraw your support of bad products, bad government or bad life situations you are enslaved. Government regulation is a trap no matter what the sweetness of the false promise is.

      How oblivious are Americans anyway??

      Are people just not aware that when your government takes your value away by imposing taxation to cover their bad laws, bad social attempts and bad monetary policies, it is not a time to give them more power to do the same under new wording.

      Decency in government didn't cause this economic imbalance, government laws and corruption did. Why are there still simpletons out there strutting and shouting the "government control and expansion is good" mantra?

      Remember the story of the dog and the scorpion crossing the river? Governments have a nature about them, ours is no different. More government means more of the same, no matter who speaks the latest hope and promise. The beast is still the beast and will devour more than it offers.

    18. Marion Leigon Ash says:

      Medicare costs could be cut so easily with the application of common sense. The focus is always on MONEY as a solution. There are many ways to cut COST.

      l. Send the 5 million illegals back to their own country.

      2. Stop genetically engineering our food supply with poisonous chemicals.

      3. Stop poisoning our water with flouride.

      4. Cell phones deliver 965 mega hertz to your brain each time you talk 2 minutes, plus the towers that service these are sending out electric waves over the entire airway looking for the cell phones.

      Especially damaging to children.

      5. Eliminate all chemical sugars, they bypass the pancreas which will not make the insulin necessary for health, increasing the diabetes disabled. Plus no chemical ingestion feeds the body, only stops it from doing it's natural work.

      6. Stop giving people yearly shots for flu,or for anything – the mercury in them damages the health of the person.

      There are many more easily removed dangers if one will just research for themselves. There are websites where the information is available. Just ask Google what you want to find.

    19. Barb -mn says:


      You mentioned: The real theft is how this site misleads.

      It’s shameful.

      what makes you think you're not being misled outside this site?

    Comments are subject to approval and moderation. We remind everyone that The Heritage Foundation promotes a civil society where ideas and debate flourish. Please be respectful of each other and the subjects of any criticism. While we may not always agree on policy, we should all agree that being appropriately informed is everyone's intention visiting this site. Profanity, lewdness, personal attacks, and other forms of incivility will not be tolerated. Please keep your thoughts brief and avoid ALL CAPS. While we respect your first amendment rights, we are obligated to our readers to maintain these standards. Thanks for joining the conversation.

    Big Government Is NOT the Answer

    Your tax dollars are being spent on programs that we really don't need.

    I Agree I Disagree ×

    Get Heritage In Your Inbox — FREE!

    Heritage Foundation e-mails keep you updated on the ongoing policy battles in Washington and around the country.