merjet Posted March 20, 2016 Share Posted March 20, 2016 I was pleasantly surprised to find on Wikipedia's National debt of the United States paragraphs about the federal government's "off-balance-sheet" debt. The figure of $19 trillion is commonly cited. What else is there? Fannie Mae and Freddie Mac obligations excluded: $5 trillion Guaranteed obligations excluded: not quantified Unfunded obligations excluded (SS, Medicare): $46 trillion The $46 trillion was as of 2009 and would be higher now. The unfunded obligations are unlike the $19 trillion in that the government hasn't had to sell Treasury bonds, notes, or bills to raise cash to pay them off now. They are future obligations. Link to comment Share on other sites More sharing options...
merjet Posted March 20, 2016 Author Share Posted March 20, 2016 That $46 trillion is a "soft" number. It is -- pardon my jargon -- the present value (link) of future benefits minus the present value of future payroll taxes to support SS and Medicare. PV(B) - PV(T). Quantifying such present values involves iffy assumptions about medical care costs and utilization, immigration, births, and more. On the other hand, it could be significantly altered with legislation. Suppose legislation was passed to reduce SS benefits 25% after 2035 or raise the Medicare eligibility age to 66 after 2025 and 67 after 2035, with no change in payroll tax rates. Both would cut into PV(B) and basically not touch PV(T). Merely to illustrate the significance, suppose before the changes PV(B) = $200 trillion and PV(T) = $154 trillion, and PV(B) after the changes is $175 trillion. $46 trillion falls to $21 trillion. Link to comment Share on other sites More sharing options...
turkeyfoot Posted March 20, 2016 Share Posted March 20, 2016 3 hours ago, merjet said: What else is there? "The U.S. fiscal gap currently stands at $210 trillion. This figure is my own calculation based on the Congressional Budget Office’s July 2014 75-year Alternative Fiscal Scenario (AFS) projection." Laurence J. Kotlikoff Professor of Economics, Boston University http://www.kotlikoff.net/sites/default/files/Kotlikoffbudgetcom2-25-2015.pdf Link to comment Share on other sites More sharing options...
merjet Posted March 20, 2016 Author Share Posted March 20, 2016 Thanks for posting, turkeyfoot. Some comments. 1. Kotlikoff's "fiscal gap" includes deficits for the federal government as a whole, not just Social Security, Medicare, and Medicaid. 2. I just reported the numbers on Wikipedia and didn't check them in any way. Wikipedia says the unfunded obligation for Social Security is $7.7 trillion. A few minutes ago, after finding a CBO spreadsheet with a yearly projection until 2089, I calculated an unfunded obligation of about $17 trillion. As I said, the numbers are "soft". 3. The financial irresponsibility of our elected politicians is astounding. Link to comment Share on other sites More sharing options...
Brant Gaede Posted March 21, 2016 Share Posted March 21, 2016 5 hours ago, merjet said: That $46 trillion is a "soft" number. It is -- pardon my jargon -- the present value (link) of future benefits minus the present value of future payroll taxes to support SS and Medicare. PV(B) - PV(T). Quantifying such present values involves iffy assumptions about medical care costs and utilization, immigration, births, and more. On the other hand, it could be significantly altered with legislation. Suppose legislation was passed to reduce SS benefits 25% after 2035 or raise the Medicare eligibility age to 66 after 2025 and 67 after 2035, with no change in payroll tax rates. Both would cut into PV(B) and basically not touch PV(T). Merely to illustrate the significance, suppose before the changes PV(B) = $200 trillion and PV(T) = $154 trillion, and PV(B) after the changes is $175 trillion. $46 trillion falls to $21 trillion. Most Medicare expenses are for the last two years of life. They'll deal with that with "death panels." --Brant Link to comment Share on other sites More sharing options...
merjet Posted March 21, 2016 Author Share Posted March 21, 2016 https://en.wikipedia.org/wiki/Death_panel Link to comment Share on other sites More sharing options...
Brant Gaede Posted March 21, 2016 Share Posted March 21, 2016 1 hour ago, merjet said: https://en.wikipedia.org/wiki/Death_panel In England you cannot get kidney dialysis if you are elderly. "Death panel" as I use it refers to that type of medical rationing. --Brant Link to comment Share on other sites More sharing options...
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