Full story at:  Capitalism Magazine

In a presentation to the National Press Foundation, January 17, 2008, Mr. Walker brought forth the following facts and projections:

1. From 1966 to 2006, the percentage of federal funds spent on Medicare rose from 1% to 19%. This trend will grow exponentially as millions of “baby boomers” enter the entitlement pool.

2. For the same period, spending for mandated government commitments rose from 26% to 53% of the total budget. The budget is increasingly out of the control of government officials.

3. As of 2007, Medicare is running in arrears. In 2017 Social Security will be in deficit. By the year 2040, Medicare and Social Security alone will be running annual deficits of nearly 900 billion dollars.

4. Medicare spending from now until 2032 will be 235% of economic growth. By 2040, Medicare will be spending about 10% of the nation’s Gross Domestic Product annually, and the annual deficits of the United States will total some 20% of the total Gross Domestic Product. 

The bottom line is this: mandated fiscal entitlements, projected into the future, are over 52,000 billion dollars. That will equal 90% of all household wealth in the U.S., and will place a burden of over 450 thousand dollars on every household in the land. This is almost ten times the present median household income level.

Mr. Walker concludes that “We face large and growing structural deficits largely due to known demographic trends and rising health care costs.” Further, “GAO’s simulations show that balancing the budget in 2040 could require actions as large as cutting total federal spending by 60 percent, or raising federal taxes to two times today’s level.”

Source/Full Story: Capitalism Magazine

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