Although some argue that policymakers can wait to solve our long-term entitlement problems, CBO’s recent Long-Term Budget Outlook suggests otherwise. According to their projections, the Social Security program is in particular trouble — and much worse than we thought.

According to CBO’s latest projections, the trust fund will become insolvent three years earlier than what we previously thought, and its long-term funding gap is 50 percent larger  (CRFB.org, 2015). After reading the foregoing statement it should be clear that the current Social Security program is not sustainable and needs reform in a big way. 

When the program was put into place people’s lifespan was shorter and there were more paying in to it as compared to those drawing it as compared to today’s figures.  The cost to administer the program alone is something of a waste when you consider that the money paid into social security could instead be paid to a private bank account and have similar rules as far as when a person could start drawing their funds out to insure they have money in their “golden” years. 

It could work similar to the present 401k’s in as much as the employers would still need to contribute as they do today when they match an employee’s FICA and Medicare tax.   As far as Medicare, you would have thought when they were busy passing laws before they read them (Affordable Care Act) they would have revised Medicare to make it more efficient and reduce the amount of fraud. 

Why the people in the federal government think everything is better if they run and control it is beyond me.  The private sector can run companies more efficient than the government ever could.  So while I don’t have an exact solution, I still can see that something needs to be done to have Americans benefit more from the money they earn through their years of employment.

References

Committee for a Responsible Federal Budget. CBO: Social Security Looks Much Worse Than We Thought.                2015. Available at: http://crfb.org/blogs/cbo-social-security-looks-much-worse-we-thought.     Accessed July 25, 2015.