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  • PODCAST: Saving the American Dream

    In this week’s Heritage in Focus, economic policy director Alison Fraser takes us through Heritage’s budget plan to save the American Dream. Make sure to listen to the full interview, here.

    To give an indication of the dire fiscal situation our three major entitlement programs present us, consider the state of Social Security, Medicare and Medicaid – combined they consume 43 percent of all federal spending.

    Social Security is currently paying out about $700 billion per year. Starting last year, it began running a cash-flow deficit, meaning it was paying out more than it took in through payroll taxes. Annual deficits are projected to continue with no end in sight.

    There is a $2.5 trillion Social Security trust fund that has accumulated as a result of surpluses from 1983 to 2009. The only problem is the money isn’t there. Government spent it on other things – roads, welfare programs, etc. In place of the money are IOUs, which are government promises to raise taxes or borrow money in the future to pay back the spent surplus funds.

    As of last year, government tapped into other tax revenue sources to cover Social Security’s deficits. However, tapping into other sources of revenue will only work until around 2037, as that’s when the IOUs must be paid.

    To think of this another way, over the years the right hand of government has been shoveling Social Security surpluses into a lock box while the left hand of government has been reaching into that lock box and spending the money.

    Medicare is even worse. It faces unfunded liabilities of $30 trillion over the next 75 years. People are currently receiving benefits from Medicare in excess of three times what they contribute in to the program.

    No level of tax hike can possibly cover these promises. The program needs desperate reform.

    And lastly there’s Medicaid. Medicaid is becoming a bigger burden on states as well as the federal government, as the program has grown over the years. According to stateline.org, the program grew to account for eight percent of state’s budgets by 1985. Just 20 years later, Medicaid consumed 22 percent of state’s budgets, and that, combined with federal spending, amounted to $330 billion.

    This program is also growing too large. It can’t continue.

    Reform of these three programs is essential in any budget plan, but of course other areas of spending need to be brought under control, our tax system needs to be simplified, and regulation needs to be more reasonable in order to return prosperity to the American people.

    Read more about Heritage’s new budget plan, here.

    To get regular updates on Heritage in Focus podcasts, visit our RSS feed or subscribe on iTunes.

    To listen to more Heritage in Focus podcasts, visit our podcast page.

    Posted in Ongoing Priorities [slideshow_deploy]

    2 Responses to PODCAST: Saving the American Dream

    1. One American says:

      Medicare is even worse. It faces unfunded liabilities of $30 trillion over the next 75 years. People are currently receiving benefits from Medicare in excess of three times what they contribute in to the program.,

      So Do We Not Give Heath To OUR People ? or Fix What Is Broken ? The Abuse of The Use On The Top Side To Get Rice Off US All ? or The Abuse of Not Looking For What Can Be Bought Over Counter Med's, And The People With Hang Nails, but the people with open cuts and trauma is this what It is For ? On Going To Heal The People With Long Lasting health trouble from what the insurance did not cover or the business from there injury, or they would not have ever had the injury in the first place, Pollution is one that hurts us all one way or an other it twists our DNA and pasted on to our kids, and or there kids, with every thing in between there kids, so it comes back to who should pay? and how to save on this for all, so why not have a call in or E-medic if it is life or death people do know what to do, if they can, but ever ask a Medical place to work off a bill? I have and they then look at the Laws that they use to take your money to start with, but there is NO laws to work a bill off if you can ? is there ? The Laws for Sum, and hurt the many ? Just ask any one? if that could or would bring down the cost for Health care over All of US today ? To Try or Not To ? WHen did it stop working ? When OUR Job's where taken away ?

    2. Dr. Allen Unruh says:

      If the diagnosis is wrong the prescription can be lethal. Obama Care will lead to euthanasia that will make abortion look like a Sunday School Picnic. Just dial their emergency # 1-800-YOU-DEAD.

      A nation of sheep will breed a government of wolves.

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