For too long, some in Washington have been waging generational warfare as a way to persuade young people we can’t afford America’s social safety net.  Those who have been fighting to gut programs like Social Security and Medicare have turned their attention to America’s 20 and 30-year-olds in a bid to convince this generation that these programs just won’t be there for them.      Generational Theft? Understanding the National Debt, Social Security and What It Means for Your Future is the title of a panel discussion our Executive Vice President, Max Richtman, is participating in today at the two day Demos Conference  in Washington.  The conference’s goal is to bring together politically engaged young people to elevate the national discussion about the economic challenges facing future generations. Demos is a non-partisan group who’s mission is to “encourage debate about the most pressing economic concerns facing their generation and the policy reforms that can address them.” 
“This national movement of young adults seeks to reverse a three-decade decline in economic security and galvanize support for a new social contract for this and future generations," said Nancy K. Cauthen, Director of the Economic Opportunity Program at Demos.
demos conference 1009So, even though politicians are fond of saying that we are mortgaging away young people's future due to the growing national debt and the rising cost of Social Security and Medicare. Is it really true?  Absolutely not  is the message we delivered to attendees today.  Here are a few key points young people need to know about Social Security and Medicare:   
  •  Social Security IS in your future
Many young people have a hard time imagining that they will ever grow old or that they will ever need Social Security. But there is plenty of evidence to suggest that they will need it as much or more than the current generation of retirees. That is because other sources of retirement savings are becoming less reliable. Traditional pension plans have become the exception rather than the rule. When the economy went into steep decline in 2009, pensions and other retirement savings such as 401(k)s lost as much as half of their worth. Housing values plummeted. But Social Security remained the rock in a chaotic financial world. Monthly checks went out as usual and for the full guaranteed amount. Future generations will count on Social Security just as their parents and grandparents do now.
  •  Social Security IS sustainable
Social Security is projected to have sufficient reserves to fund full benefits through the year 2037. Contrary to what most people believe, Social Security will not be out of money or “bankrupt”.  After 2037, there will still be enough revenue flowing into the Trust Fund from payroll taxes and other receipts for Social Security to continue paying more than 75% of benefits.  Of course, we know that Congress will take action to preserve Social Security’s benefits for many generations to come. 
  • America Does Not Face an Entitlement Crisis; It Faces a Health Care Financing Problem
According to the Congressional Budget Office, the rate at which health care costs grow relative to national income rather than the aging of the population is the most important determinant of future federal Medicare and Medicaid spending . In fact, according to projections by the Congressional Budget Office (CBO), if every entitlement in the federal budget were repealed outright eliminating Social Security, Medicare, Medicaid and other critical programs but nothing were done to slow the growth in health care costs overall, we would still find ourselves spending almost 70 percent of the nation's wealth on health care by 2082. On the other hand, if the rate of growth in overall health care is restrained so it is no longer growing faster than the rest of the economy, Medicare's long-range financial deficit could be cut by well over one-half.  You can watch some of the Demos events online here.