USA Today offers an outstanding analysis of why an “Aging Population Makes this Deficit Scarier“ than the one in the 1980s: “When deficits started taking off 20 years ago, the retirement of the baby boom generation was just a distant worry. Now, as the nation faces years of red ink, including at least a $400 billion shortfall in 2003 alone, the graying population is a fast-approaching reality that will put unprecedented strains on Medicare, Social Security and the economy starting around 2010. ... Legislation to add a 10-year, $400 billion prescription drug benefit to Medicare, which the Senate could vote on this week, could make the problems far worse. The White House, which originally wanted any drug bill to include major changes to reduce costs and move Medicare closer to the private insurance market, has largely dropped those demands.... Today, Social Security and Medicare payroll taxes are generating a trust fund of surpluses. But by 2008, the government will have to start pumping more money into Medicare. Even without a drug benefit, the health program alone is expected to consume 20% of all revenue by 2026.”
