[I]n order to prevent the debt situation from expanding, and depending upon which economist you trust concerning the multiplier effect, federal spending must be reduced to somewhere between $2,085 trillion on the high end and $1.344 trillion on the low end. And here are the current big-ticket items:
$761 billion - Social SecurityThat comes to $2,694 billions, which is roughly $2.7 trillion. We need to get that down to at least $2.085 trillion, and probably much lower.
$468 billion - Medicare
$269 billion - Medicaid
$598 billion - Unemployment/Welfare
$679 billion - Department of Defense + Foreign Wars
If we entirely eliminate welfare and unemployment, Medicare and Medicaid, we'd be down to $1.44 trillion, which is within the right range. Some cuts to defense will be possible once the wars end, although we do need to replenish the machinery and stores we have used up in Iraq and Afghanistan.
So, it's doable, right? Well, one little thing got left out.
One major difference between Social Security and pensions is that the federal government has not set aside any money, or created a “revenue source” (aka a new tax) to fund those pensions.Last year that was $268 billion, and that's before the Boomers retire. So, figure a good $400 billion in extra cuts are needed here. Well, maybe we can trim Social Security a bit... say by half... or Social Security by a quarter, and the pensions by half... hm.
It's past time that we started to hear serious consideration of these issues in public.