DeMint Calls Social Security and Medicare Report ‘Alarming’

May 12, 2009 - WASHINGTON, D.C - Today, U.S. Senator Jim DeMint (R-South Carolina), chairman of the Senate Steering Committee, responded to the annual report released Tuesday by the trustees for Social Security and Medicare. According to reports, the cash-flow surpluses for the two programs will drop significantly over the next few years. Medicare’s cash-flow is now expected to go negative this year. The trustees anticipate that Social Security will begin paying more in benefits than it collects in taxes in 2016, a year earlier than previously predicted.

“This year we will have to borrow from China and other nations to pay for Medicare benefits and soon we will have to do the same for Social Security. This report is alarming but it shouldn’t surprise anyone. Many of us have been predicting this crisis for over a decade, yet Democrats ignored the problem and kicked the can down the road,” said Senator DeMint. “Now the very thing we predicted is happening right before our eyes: Social Security and Medicare are going bankrupt and won’t be able to pay promised benefits without massive borrowing.”

“The Washington charade is over, politicians can no longer hide the fact they have raided the Social Security Trust Fund to pay for wasteful spending and failed to save a single penny for seniors.”

Last year the Center on Budget and Policy Priorities, a liberal think tank in Washington, said Social Security was in “excellent financial shape over the near term” and called the program’s shortfall “relatively small and manageable.” This view is shared by most Democrats in Congress and is the reason why nothing has been done in the past decade to save and strengthen Social Security for future generations.

“The key to true entitlement reform is to empower Americans with more ownership and control over their health care and income in retirement,” said Senator DeMint. “We can dramatically reduce Medicare costs simply by giving Americans the ability to take their own private health plans into retirement. These personalized plans give seniors better care and force providers to compete for their business. And we make Social Security permanently sustainable by converting it from a pay-as-you-go program to a fully-funded system that actually saves workers’ contributions for their retirement in a place where politicians cannot raid them for other government programs.”

Senator DeMint has authored legislation that would permanently save Social Security by allowing younger workers to voluntarily save a portion of their Social Security taxes. Workers would have the same savings options available to Members of Congress and would be guaranteed to get more in retirement than what seniors get today.

“History has shown that policies that transfer power from individuals to government do not work. Congress has raised payroll taxes and made massive cuts in retirement benefits numerous times, yet the programs are still going bankrupt. Those who peddle these false solutions continue to deceive the public for their own political gain. Raising taxes and making big benefit cuts force Americans to pay for Washington's mistakes and they fail to truly solve the underlying structural problems with these pay-as-you-go, government-run programs. The time has come for Congress to stop pushing the problems onto the backs of our children and grandchildren, and start giving Americans the tools to secure their own future.”