The following editorial appeared recently in the Dallas Morning News:
Here we go again. The experts who oversee Social Security and Medicare rang the alarm bells once more last week.
The Social Security trust fund that pays benefits to disabled recipients will exhaust its reserves in 2016, the trustees explained in their annual report. Come 2036, the same result will afflict the fund that pays retirees their Social Security benefits. Both funds, by the way, sail into deep water earlier than trustees predicted only last year.
Medicare fared a little better. Its hospital trust fund won't be depleted until 2024. That's the same date as projected last year, but 1.2 million Americans also have joined Medicare since then. The fund is already spending more on health care than it takes in from payroll taxes.
One temptation is to wail and head to the nearest tornado closet. But the better response for members of Congress and presidential hopefuls is to start taking action.
Texas Sen. Kay Bailey Hutchison has proposed a practical way to solve some of Social Security's challenges. The Republican would change how Washington calculates benefits.
Numerous economists have argued that benefits are more generous than the inflation rate. By linking them more directly to inflation, benefits would more accurately reflect living costs. The change also would save the system money.
This move shouldn't require a partisan bloodbath. This isn't calling for private accounts or tax hikes. The White House and GOP officials even discussed it last year. It shouldn't entail a giant political risk to make this move before November or after the election.
Similarly, lawmakers should move money from the retiree fund into the disability fund so that the latter doesn't crash in four years. That's no long-term solution, but it's an interim way to reassure disabled recipients.
Stabilizing Medicare is too big an issue for the last few months of an election year, but President Barack Obama and likely GOP nominee Mitt Romney still should lay the groundwork for action next year.12 comments on this story
To his credit, Romney has presented a plan. Among other changes, he would let seniors in the future choose traditional Medicare or use a government voucher to purchase private insurance. We like that as a way to encourage choice and competition.
The president mostly talks about Medicare reform as a way to finance the 2010 health care law. After that, his vision for generating savings largely depends upon changing how medicine is practiced, such as rewarding doctors for results, not services.
That's good, but it's not enough. The president must provide more details, while Romney should explain how his reforms would work.
We can't afford to waste this election. The warning bells are sounding, very clearly.