GOP Leader Blog
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Reckless Abandon: Gov’t Takeover of Health Care is a Double Shot Against Social Security Solvency
Posted by
Brendan Buck
on
March 25, 2010
It's not breaking news to anyone that our nation is heading off a fiscal cliff. Under the current arrangement, federal entitlements are unsustainable and drawing increasingly closer to insolvency. Today, in fact, it was revealed that on the Democrats' watch Social Security will pay out more than it collects in revenue for the first time - five years ahead of schedule. The New York Times reports:
This year, the system will pay out more in benefits than it receives in payroll taxes, an important threshold it was not expected to cross until at least 2016, according to the Congressional Budget Office...The problem...is that payments have risen more than expected during the downturn, because jobs disappeared and people applied for benefits sooner than they had planned. At the same time, the program's revenue has fallen sharply, because there are fewer paychecks to tax.At a time when our nation's finances are already in dire straits, the decision of Democratic leaders to focus on a job-killing government takeover of health care rather than putting Americans back to work has only accelerated our march to fiscal collapse. While Americans were asking, "where are the jobs," Democrats arrogantly dragged the nation through a year-long exercise to force the health care plan into law. However, ignoring and adding to our jobs crisis was not the only fiscal consequence of the Democrats' immovable allegiance to a government takeover of health care. Little discussed, the new law also includes reckless accounting gimmicks that use $29 billion in Social Security revenues to "offset" new health care spending. Former Congressional Budget Office Director, Douglas Holtz-Eakin explains: Social Security revenues are expected to rise as employers shift from paying for health insurance to paying higher wages. But if workers have higher wages, they will also qualify for increased Social Security benefits when they retire. So the extra money raised from payroll taxes is already spoken for. (Indeed, it is unlikely to be enough to keep Social Security solvent.) It cannot be used for lowering the deficit.So rather than ensuring social security revenues pay for the cost of future benefits, Democrats have used that money to offset their new spending. This may make the health care bill appear to cover its costs, but in reality it leaves $29 billion less for Social Security. Democrats demonstrated clearly that nothing would stand in the way of their government takeover of health care - not the American people, nor our federal solvency. The health care law is a grave threat to American jobs, and also to our nation's ability to pay its bills. There is a price tag, however, for this out-of- touch legislating - and this bill is coming due sooner than expected. |