02.28.2010 0

Too Hot Not to Note: A grim sign for ObamaCare

  • On: 03/29/2010 10:02:16
  • In: Fiscal Responsibility
  • ALG Editor’s Note: In the following featured editorial from the New York Post, the board notes the irony of the government takeover of health care coinciding with the crumbling of the entitlement state in Social Security:

    A grim sign for ObamaCare

    How ironic that, even as the Senate last week debated the reconciliation “fixes” to ObamaCare, word came that Social Security has reached the so-called tipping point — years ahead of schedule.

    For the first time, Social Security will pay out more in benefits than it receives in tax revenue, to the tune of $29 billion.

    The reason: Continued high unemployment means there are fewer paychecks from which to deduct Social Security taxes. Meanwhile, many who can’t find work are applying for benefits much earlier than they’d planned.

    The so-called tipping point wasn’t supposed to arrive until 2017, according to current congressional projections.

    And it also means that the ultimate day of reckoning — when Social Security runs out of money unless something is done to stabilize the system — has been pushed ahead by four years, to 2037.

    So is this really the time for the US to be setting out on a trillion-dollar entitlement adventure filled with so many unknowns and untested elements?

    And, more important, whose ultimate financial impact on the sky-high — and still soaring — national debt is open to so much question?

    You’d think not.

    But President Obama and congressional Democrats don’t seem to have gotten the message.

    Which is that even beyond the inherent costs of a system like Social Security, unsettled economic conditions can have a swift and unexpected impact.

    Budget estimators predicted that unemployment would average 8.2 percent last year and 8.8 percent this year.

    Instead, it remains at about 10 percent.

    No, Social Security isn’t running out of money just yet: Thanks to some fixes a quarter-century ago and past robust economies, the system maintains a balance of $2.5 trillion.

    But with annual payments now running in the red, that balance will slowly be depleted.

    And, by law, Social Security can’t pay out more money in any given year than it has in its balance.

    In other words, it cannot print money.

    The same could well hold true for ObamaCare, once its payments fully kick in down the line.

    Is Congress paying attention?

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