An accountant explains.
Hat tip to Theo.
Nations throughout history — from Rome to the USSR — have made fatal mistakes. Of course, here we’re talking about a nation that accounts for 25% of the world’s GDP, so when this ship goes down it will take much of the rest of the world with it.
SS could be fixed easily with two simple and appropriate changes. 1. You must have put into the system to draw out from the system and the amount you draw out will be proportionate to how much you put in. 2. Pay out no more every month/year then the system takes in. That would mean that as less money comes into SS each senior would see their payment decrease. In a sense like a para-mutuel system that cannot by definition go broke.
A similar thing could be done with Medicare. Then to the extent it needs more funds to be an adequate health insurance for seniors increase the payroll tax and/or increase the funding from the general fund.
The inclusion of Medicaid but not the rest of welfare is deceiving since there are over 2400 different “welfare” programs at the federal level. The fix for welfare would be to: First limit the total any adult (and their family) could receive could not exceed the minimum wage, i.e. about $320 a week. Second distribute the funding to the lowest level (states, counties, cities) to administer and require that anyone needing/wanting welfare must work 40 hours a week for their wages/welfare. No work no welfare. Third require every recipient to pay they taxes and SS payments on their “income”
These three changes would balance the budget.
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