“Each day, 10,000 baby boomers retire and begin receiving Medicare and Social Security benefits.”
- Sen. Rob Portman (R-Ohio), writing in The Wall Street Journal, July 22, 2014
“Portman is on solid ground with this number. He earns a coveted—and rare—Geppetto Checkmark.”
- Washington Post Fact Checker
The baby boomers are retiring. What does that mean for the rest of us? One thing it means is that the ratio of working adults to retirees is changing. The number of tax-paying workers is not keeping pace with the influx of retirees.
Right now there are about 3 US workers for every retiree. By 2050, there will be 2 workers for every retiree. Also by 2050, the U.S. proportion of GDP spent on just Social Security and Medicare is projected to rise from 8.6% today to 11.5%. Bottom line: the tax base is shrinking just as the tax burden is growing. It's pretty much an untenable situation. Something has to give.
Possible fixes:
- reduce Medicare spending/costs per beneficiary
- reduce Social Security payments
- increase the age for qualifying for Medicare and/or Social Security
- increase the number of young immigrants (future taxpayers!)
It's a beginning.