The American Enterprise Institute’s Jim Pethokoukis found this great chart (below) by the Urban Institute’s Eugene Steuerl. It shows the lifetime Social Security and Medicare taxes and benefits.
“Couples retiring today, with roughly the average earnings of workers in general, as well as average life expectancies, still receive about $1 million in lifetime benefits,” writes Steuerle. However, they will only pay $747,000 in Social Security and Medicare taxes over that lifespan.
The gap between taxes and benefits has always been large. However, more people retiring and living longer–both great things–is causing the financial situation of both programs to get worse. As it stands now, Social Security won’t be able to pay full benefits starting in 2033, and Medicare Part A, which pays for hospital services, will go bankrupt in 13 years.
These programs must be reformed or the country will have to endure painful benefit cuts, crushing taxes, or both.
As U.S. Chamber Executive Vice President Bruce Josten said in June, “We need to make the responsible common-sense choices now, even if they are hard, to guarantee the promise of these programs to the next generation.”
Learn more at the U.S. Chamber’s “Ten Truths About America’s Entitlement Programs.”