Can Our Social Insurance Systems Survive the Demographic Shifts of the Twenty-First Century?
Sylvester J. Schieber
This paper assesses the long-term socio-economic and political viability of the Social Security and Medicare programs. The aging and retirement of the baby boom after the turn of the century promises to put new financial pressures on these crucial government programs. It is important that we understand the timing and magnitude of the pressures so that we can do what is necessary to assure that the retirement income security of future generations is on a sound fiscal and equitable social policy basis.
The paper begins by narrowing the focus of the discussion of social insurance to Social Security cash benefits and Medicare. The assessment of the system requires the utilization of generally acceptable measures of financial operations and actuarial projections which are identified. In order to evaluate the long-term viability of the system, it is important to understand how the system is financed, and to assess the magnitude of the financing requirements within the context of overall economic operations and political sensitivity to what can be sustained.
Assessing the Social Security retirement, survivor, and disability benefit programs is done within the context of continuation of existing retirement patterns.
Medicare can only be considered within the context of the U.S. health system generally, and its future needs to be considered in light of the future of the health system.
The conclusions on the long-term viability of the two elements of our social insurance system studied differ from one to the other.
It does not appear that the shift in resources required to meet the general cash benefit promises being held out through Social Security are so large that we