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U.S. better start planning today for a nation of centenarians

By Des Moines Register editorial

Last update: October 14, 2009 - 3:35 PM

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A baby born in a wealthy country today is expected to live to be 100 years old, according to new research published in the medical journal Lancet. Babies would be celebrating if they understood the news. But future generations would start wailing if they could grasp what it means for them as workers and taxpayers.

They will be among those funding Social Security and Medicare for an aging population relying on those public programs longer and longer.

If they could talk, they'd ask lawmakers to make changes now: To increase the age of "retirement" to qualify for Social Security benefits. To reduce unnecessary spending for Medicare. To craft policies recognizing there is no way to sustain these costly benefits for a growing number of Americans without making such changes.

But babies can't talk -- or vote. So it is up to lawmakers to act in the interests of future generations, and act now. As the programs are currently structured, the United States simply can't afford babies living 100 years.

Social Security provides monthly income to seniors and is funded by a payroll tax on workers. Medicare provides health insurance to seniors and is largely funded by payroll taxes on workers and general revenues paid by taxpayers. The two programs are already in serious fiscal trouble.

Recent projections have the Medicare trust fund, which pays hospital bills for older Americans, possibly running out of money in 2017. The Social Security trust fund will be exhausted in 2037 -- even with modifications that have increased the age at which people can collect benefits.

Without changes, today's infants will be eligible for Medicare health insurance at age 65 - and could utilize the public program for 35 years. That may be longer than they worked and contributed taxes to fund hospital insurance in the program. Social Security faces the same problem.

For future generations, it's unreasonable to define "retirement" -- and the public benefits that accompany it - as something Americans do in their mid-60s. Because when Social Security and Medicare were created, it appeared people would work -- and pay taxes -- much longer than they would collect benefits from the programs. If they lived long enough to even collect benefits.

In the 1930s, when Social Security went into effect, life expectancy at birth was about 58 years for all men and 62 years for all women -- especially low due to high infant mortality rates. When Medicare was created in 1965, the life expectation at birth was about 68 years for white males and 74 for white females.

And now -- as Congress is crafting major health care reform legislation -- a baby born today is expected to live 100 years. Lawmakers cannot ignore this reality. They cannot ignore that Americans who live longer will have to work longer. And that going forward taxpayers cannot afford to pay for their own health care and an increasing number of seniors using Medicare without adjustments to the status quo.

Lawmakers must acknowledge that unless this country makes sacrifices now, the increasingly long lives of babies will be a fiscal disaster.

DES MOINES REGISTER

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