Cost of Government Benefits
Yesterday’s USA Today reported that the costs of senior benefits have increased 24%, after inflation, since 2000. According to the newspaper:
“The cost of government benefits for seniors soared to a record $27,289 per senior in 2007, according to a USA TODAY analysis.
“ . . . 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.”
USA Today’s report provided two additional facts of interest:
- “The cost of senior benefits is equal to $10,673 for every non-senior household.”
- “About 35% of the federal budget is spent on senior benefits, up from 32% in 2004.”
Unfortunately, in trying to provide perspective, the report contained quotes by a lobbyist for the AARP and the liberal Center for Economic Policy and Research (CEPR), which do nothing to further inform discussion. According to the AARP lobbyist, there’s a health care crisis rather than an entitlement crisis. And an economist with the CEPR equates focusing on the cost of senior benefits to “granny bashing.”
A comment by a blogger at Citizens Against Government Waste correctly identifies the problem of entitlements for seniors:
“When the current elderly were younger, they were supporting their elders. Just as today’s youth is supporting the current elderly. The problem is that the youngest generation can not expect to receive the same benefits when they grow older because the proportion of workers to retirees is getting smaller.”
On the topic of income redistribution, an article in the December 1994 issue of The Freeman provides a worthwhile discussion of the many "neglected consequences of income redistribution."