Question: In what year will America go the crapper? Answer: 2017
“Government spending on health care could nearly double by 2017 to more than $2 trillion, according to a new federal study, reflecting a surge that promises to complicate the campaign debate about health care,” the Wall Street Journal reports:
Driven by the aging of the baby-boom generation and rising costs of new drugs and medical technology, Medicare, the big federal health program for the elderly, will take up 20.7% of national health spending by 2017, according to the report.
Overall, the report projects health-care spending in the U.S. will hit $4.3 trillion by 2017, nearly double the 2007 amount. That would equate to nearly 20% of gross domestic product. In 2007, health-care spending accounted for 16.3% of GDP, according to the study. But more of that cost is expected to shift to government agencies — even as the federal government struggles to shrink huge deficits.
Your taxes will skyrocket. According to Michael Cannon, Cato’s director of health policy studies, “Even if we were to start immediately, it would require a tax increase equal to 25 percent of wages.”
Mr. Cannon wrote those words in April 2006, almost two years ago. Presumably, the tax increase would be even higher today — and we’re not starting today, either.
Do we have any other reason to take special note of the year 2017? We do:
Social Security spending will exceed projected tax collections in 2017. These deficits will quickly balloon to alarming proportions.
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The billions that go to Social Security each year will make it harder to find money for other government programs or require large and growing tax increases.
You have nine years until it all goes sideways. Live them well.