The deficit and the DEFICIT

Robert Samuelson wonders why, with near full-employment, the government cannot run a surplus in “No shame, no sense and a $296 billion bill.” But he also notes that the current gap will look like some lost spare change compared to the entitlements explosion:

What truly matters is government spending. If it rises, then future taxes or deficits must follow. There's no escaping that logic. The spending that dominates the budget is for retirees. Social Security, Medicare (health insurance for those 65 and over) and Medicaid (partial insurance for nursing homes) already exceed 40 percent of federal spending. As baby boomers retire, these costs will explode. Unless they're curbed, they'll require tax increases of 30 percent to 50 percent over the next 25 years.

Samuelson concludes that political impasse means that nothing will be done about deficit spending until we’re in crisis mode. My fear is that the overwhelming political leverage of the Baby Boomers means that, even in the midst of a fiscal meltdown, there will be no meaningful reform until the money is all gone.

Extra – Will Franklin finally got back to his Social Security Thursday posts again. (Ooops: credit where credit is due. That post is by Willisms contributor Justin B.)