Entitlements: A Collision Course With Fiscal Reality
Our major federal entitlement programs operate as pay-as-you-go systems—the payroll taxes of today's workers are transferred to current beneficiaries. While there were roughly 40 workers for every beneficiary in the 1940s, today there are just three. That number will only decrease as the Boomer generation retires. Longer lifespans, combined with retirement ages that have hardly budged in 50 years, make the fiscal outlook worse. Entitlements already account for about two-thirds of all federal spending, not including interest on the debt issued to pay for them. Something will have to give—means testing, raising the retirement age, or taxes, or a combination of those and other measures. How should we reform these programs for long-term sustainability?
Senior Editor, Business Insider
Economic Policy Fellow, Milken Institute; Senior Fellow, Center on Budget and Policy Priorities; Former Chief Economist to Vice President Joe Biden
Resident Scholar, American Enterprise Institute
Co-Chair, Economic Security Project; Co-Founder, Facebook
President, Committee for a Responsible Federal Budget; Head of the Campaign to Fix the Debt