John Goodman (Imprimis, 3/09) delivers a common sense speech about America's financial obligations:
He starts off with a bang:
The first of the Baby Boomers started signing up for early retirement under Social Security last year. Two years from now they will start signing up for Medicare. All told, 78 million people are going to stop working, stop paying taxes, stop paying into retirement programs, and start drawing benefits. The problem is, neither Social Security nor Medicare is ready for them. The federal government has made explicit and implicit promises to millions of people, but has put no money aside in order to keep those promises. Some of you may wonder where Bernie Madoff got the idea for his Ponzi scheme. Clearly he was studying federal entitlement policy.
It gets better--well, actually it gets worse:
The Trustees of Social Security estimate a current unfunded liability in excess of $100 trillion in 2009 dollars. This means that the federal government has promised more than $100 trillion over and above any taxes or premiums it expects to receive. In other words, for Social Security to be financially sound, the federal government should have $100 trillion—a sum of money six-and-a-half times the size of our entire economy—in the bank and earning interest right now. But it doesn’t. And while many believe that Social Security represents our greatest entitlement problem, Medicare is six times larger in terms of unfunded obligations.
How much do we owe? Mr. Goodman answers that, too:
[I]f the federal government suddenly closed down Social Security and Medicare, how much would be owed in terms of benefits already earned? The answer is $52 trillion, an amount several times the size of the U.S. economy.
52 trillion dollars. Look at that number again. Fifty two trillion dollars, with a "t."
What makes Mr. Goodman different from most writers is that he actually offers solutions. That's the second part. You can click on the link below for his full speech: