Entitlement programs are consuming an ever-larger share of the federal budget. Does the next president have a plan to deal with the problem?
By Margot Sanger-Katz | Updated: August 23, 2012 | 12:28 p.m.
Last year, the oldest members of the baby-boom generation turned 65, leading the demographic bulge that will come to dominate the nation’s entitlement programs, federal budgets, and political debates for years to come. Every day until 2030, 10,000 Americans will age into Medicare and Social Security, even as the proportion of young working people paying into the programs shrinks.
The graying of the population presents some difficult math, and it is complicated even more by the economic downturn’s hit on income-based entitlement programs, including Medicaid and food stamps, that have seen their enrollments surge. The Congressional Budget Office estimates that Social Security will grow from 5 percent of gross domestic product to 6.2 percent in 25 years, while Medicare will rise from 3.7 percent to 6 percent of GDP. Recent updates from the Medicare and Social Security trustees estimate that the retirement fund will be insolvent in 2033 and that Medicare will go broke even sooner; the hospital trust fund is expected to start owing more than it collects in 2024.