From “The Clash of Generations” by Laurence J. Kotlikoff and Scott Burns, page 4:
Second, we’ll suggest that Shakespeare had it wrong when he said, “The first thing we do, let’s kill all the lawyers.” The right statement is, “The first thing we do, let’s kill all the accountants.” Government accountants have concealed Uncle Sam’s Ponzi scheme since its inception by focusing attention on the official debt. But they knew, or should have known, as a matter of economic theory, that official debt is a figment of our language, not a meaningful measure of our fiscal affairs. As a result, they’ve made sure, with the help of the politicians, that the public (and most economists) would ignore the rapidly metastasizing economic tumor associated with our living beyond our children’s means.
In referring to the Social Security/Medicare Ponzi scheme the authors could have easily wished bloody annihilation upon actuaries as accountants.
Social Security has moved three years closer to emptying its trust fund. Mark that on your calendar for 2033, not the 2036 projected only a year ago.
Medicare also is on life support. The hospital-insurance program for seniors is expected to spend its last dollar in 2024. That’s the same projection as the trustees who oversee these entitlement programs issued a year ago — but five years sooner than they had projected as recently as 2010. And the trustees also warned Monday that Medicare’s future could be even more dire than their report suggests.
A year ago, the trustees warned that Social Security’s disability insurance fund would be out of money by 2018. As of Monday, that date is 2016, four years from now.
The report itself begins and ends with the warning:
Lawmakers should address the financial challenges facing Social Security and Medicare as soon as possible. Taking action sooner rather than later will leave more options and more time available to phase in changes so that the public has adequate time to prepare.
But my question is why should anyone be listening to these guys considering their track record? Between the 2011 and 2012 report the drop-dead date for the Social Security ‘trust’ fund went from 2036 to 2033. At that rate the 2017 report would project a drop-dead date of 2018 which makes more sense given the circumstances.
You have a ponzi scheme funded by a dwindling labor market which invests in Treasury bonds largely dependent on that same market having to fund payouts for baby boomers who, thanks in part to Medicare, will outlive mortality predictions all while tax increases or benefit cuts are impractical within a political system predicated on pandering.
Without actuaries and their 200-page jargon-laden reports that situation might be a little more obvious to a few more people.