The cost of government benefits for seniors soared to a record $27,289 per senior in 2007, according to a USA TODAY analysis.You would think with these large costs looming on the horizon that this would be a major issue in the current election and candidates would explain how we are going to pay for this. And yet I have no idea how any of them plan to handle this.
That's a 24% increase above the inflation rate since 2000. Medical costs are the biggest reason. Last year, for the first time, health care and nursing homes cost the government more than Social Security payments for seniors age 65 and older. The average Social Security benefit per senior in 2007 was $13,184.
The federal government spent $952 billion in 2007 on elderly benefits, up from $601 billion in 2000. It's the biggest function of the federal government. States chipped in $27 billion more in 2007, mostly for nursing homes.
The senior boom, however, starts big time in 2011, when the first baby boomers (79 million people born between 1946 and 1964) turn 65 and qualify for Medicare health insurance. The oldest baby boomers turn 62 this year and qualify for Social Security at reduced benefits.
The cost of senior benefits is equal to $10,673 for every non-senior household.
Economist Dean Baker calls it "granny bashing" to focus on the cost of senior benefits. The elderly paid a designated tax for Social Security and Medicare taxes during their decades of working to support these programs when they retired, says Baker, co-director of the liberal Center for Economic Policy and Research.The problem with thinking like this is that the money was not really set aside. Instead it has been used to finance the massive budget deficits we have run. And even if the money really was set aside and grew with interest I don't believe it would have been enough to cover the increased costs of health care and the increased lifespan of Americans.
via USA Today