Implications of Change in Life Expectancy, Radical Change in Life Expectancy, Implications on Social Security, Implications on Health Care of Life Expectancy
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ZingerKing is published on Monday, Wednesday and Friday of each week from September through June. In July and August ZingerKing will publish on Wednesday each week.
_______________________________________________________________________________
Friday August 28, 2009
Special Weekend Edition
Summer Schedule
This is Part I of a two part series on implications of radical change in life expectancy on public policy.
Today’s Zinger:
When You Are Driving 100 Miles An Hour You Better Be Looking Well Down The Road To Allow Time To Adjust For The Changes Ahead.
Who Said It:
"If I Knew I Was Going To Live So Long I Would Have Taken Better Care Of Myself."
The Morning Briefing:
What would you do if you lived 100 years? What would the government do if you lived 100 years? Improved lifestyles and advanced medical care has increased the average US life expectancy to 77.9 years according to the Center for Disease Control. American’s life expectancy has increased every year for more than a century, with the exception of the period during the great depression.
Life Expectancy 1840 to 2000
Blue: Male
Red:Female
While the future improvement in life expectancy is unknown, recent advances in gene therapy, stem cell research and nanotechnology could fundamentally shift the life expectancy curve and 100 may be the new 78 within the next 40 or 50 years. Centenarians are the fastest growing segment of the population and is projected to grow at 20 times the rate of the general population by 2050.
Looking at a life expectancy of 100 years causes pause. With the decline in pension plans and an increase in self-directed retirement accounts, individuals must ask, “do I have enough should I live to be 100?” At the same time, with Medicare going broke and Social Security with a $50 trillion dollar unfunded liability, the government must ask, “do we have enough to care for a society that is living longer, and maybe much longer?”
Individuals,the government and society as a whole must think about the future, not the current state, when planning and making public policy decisions. And now, medical technology is on the frontier of a potential breakthrough in aging and life expectancy that could change all of the rules.
Increased life expectancy, a downward revision in long term growth of the US economy, retirement accounts ravaged by economic realities of the past few years and mounting US debt pose a terrifying outlook for the individual and the country. In this two part series,Zinger looks at the implications of longevity on politics and public policy. Decisions today will have far reaching implications for generations to come.
The Discussion:
Can you imagine a world without heart disease? How about the elimination of cancer, diabetes and Alzheimer’s disease? What about growing organs to replace defective organs? All of these medical miracles are potentially within our lifetime. Combine these medical advancements with improvements in nutrition and a healthy lifestyle and you could easily join the ranks of the One Hundred year old club. Once a rare group, Centenarians is now the fastest growing segment of the population.
For the individual American, the potential cost of retirement must be of concern. It will take far more savings and much lower spending to meet the potential cost of a life expectancy reaching100 years. Most Americans are in denial about how much it will cost for retirement. (click on link to see related article in a new window).
As our government takes on a greater role in our lives, and legislation is being crafted to deal with the costs of Social Security, Medicare,Medicaid, health care for all citizens, the government must legislate with an eye to the future. Government programs never seem to shrink in scale or cost. Whatever is legislated today, will most likely become larger and more costly over time. The escalating costs of programs, a rapidly aging population and the potential for radical change in longevity will have far reaching cost implications. Add to this a government with political will geared to appeasing and we run the risk of failing to deal with real problems.
Societal programs are built around a growth model. The assumption is that the population will grow, incomes will grow and the tax base can grow to sustain programs into the future. However, we are entering an era where the growth model can no longer be counted on to sustain government taxes. Therefore, we must look to changes in the core of the these programs.
Social Security:
When Social Security was enacted in 1935, the country was trapped in a sustained Depression. Life long financial security for Americans was apolitically popular notion. When first enacted by President Roosevelt,there were ten workers contributing to the system for each beneficiary. Currently, there are three workers for every beneficiary and as the population ages, and life expectancy increases, we could see a 1:1 ratio within the next two generations. Before this happens, we must undertake dramatic changes to avoid a total collapse of the system. Lower benefits, and changes to retirement age must be adopted. Some predict the retirement age must increase to 75-80 within the next 10 years.
Medical Care and Medicaid:
For Medicare, the implications are more pressing. First enacted in 1965 as part of Lyndon Johnson’s Great Society initiative, Medicare was enacted to provide basic health care to the elderly. Over the years the benefits were increased and coverage was expanded. Medicare is about to go bankrupt. The Congressional Budget Office estimates that Medicare will be out of funds in less than eight years. It is critical that something be done to fundamentally change the costs.
Implications of Life Expectancy on Public Policy:
The Conclusion:
There are three variables in social programs:
Let's assume we can no longer pay for social programs through government debt (like George W.Bush did with the Medicare Prescription Drug Program) and all programs must be budget neutral.
Therefore:
Taxes Levied = Taxes Needed
To simplify the analysis, the cost of any social program is the function of three variables and tax revenue is a function of three variables:
Taxes Levied = function of economic growth, income and tax rate
Taxes Needed = covered lives x cost of benefits x time covered
Taxes Levied = Taxes Needed
econ. growth rate x income x tax rate = covered lives x cost of benefits x time covered
The next ZingerKing will look at the math and the implications for public policy on Medicare, Medicaid, Social Security, population growth,abortion and further dependence on the government for our future financial and medical security.
Who Said It:
George Burns who lived to age 100
"If I Knew I Was Going To Live So Long I Would Have Taken Better Care Of Myself."
Today’s ZingerToon:
Recent ZingerKing Articles:
Articles can be found under “Recent Articles” in the purple sidebar. Older articles can be found in the archives that are stored by month. These are found at the bottom of the purple sidebar. Here is a list of the most recent articles.
Zingers Alternative For health Care Reform
The Tug Of War Of Special Interest Groups and Health Care Reform
Credibility Of The Administration Is Challenged
Taming The Angry Mobs
Creating A Free Market Alternative to Government Health Care
Cash For Clunkers
Culturalism versus Racism in America
The Revolving Door of Politics: Franken, Palin, Biden
Consequences of Taxing the Wealthy
Obama's Clintonesque Moment
Overcoming Bias: Challenging Our Own Beliefs
Health Care Just Made Me Sicker
Shameless Request For Support:
ZingerKing operates without advertising or government funding (obviously). The purpose is to inform and educate its readers about economic and political issues that affect our lives.
Help ZingerKing grow. Have you Zinged someone lately? Please forward a link to ZingerKing to a friend, family member or neighbor. If you enjoy reading the Zinger please subscribe (see the subscribe box at the top of the article in the purple side band). Subscribers receive the"Morning Briefing" when published with a link to the full article. Periodic alerts are sent to subscribers only with important updates and insights into critical issues. Your email address will not sold to others and will not be shared.
ZingerKing is published on Monday, Wednesday and Friday of each week from September through June. In July and August ZingerKing will publish on Wednesday each week.
_______________________________________________________________________________
Friday August 28, 2009
Special Weekend Edition
Summer Schedule
This is Part I of a two part series on implications of radical change in life expectancy on public policy.
Today’s Zinger:
When You Are Driving 100 Miles An Hour You Better Be Looking Well Down The Road To Allow Time To Adjust For The Changes Ahead.
Who Said It:
"If I Knew I Was Going To Live So Long I Would Have Taken Better Care Of Myself."
The Morning Briefing:
What would you do if you lived 100 years? What would the government do if you lived 100 years? Improved lifestyles and advanced medical care has increased the average US life expectancy to 77.9 years according to the Center for Disease Control. American’s life expectancy has increased every year for more than a century, with the exception of the period during the great depression.
Life Expectancy 1840 to 2000
Blue: Male
Red:Female
While the future improvement in life expectancy is unknown, recent advances in gene therapy, stem cell research and nanotechnology could fundamentally shift the life expectancy curve and 100 may be the new 78 within the next 40 or 50 years. Centenarians are the fastest growing segment of the population and is projected to grow at 20 times the rate of the general population by 2050.
Looking at a life expectancy of 100 years causes pause. With the decline in pension plans and an increase in self-directed retirement accounts, individuals must ask, “do I have enough should I live to be 100?” At the same time, with Medicare going broke and Social Security with a $50 trillion dollar unfunded liability, the government must ask, “do we have enough to care for a society that is living longer, and maybe much longer?”
Individuals,the government and society as a whole must think about the future, not the current state, when planning and making public policy decisions. And now, medical technology is on the frontier of a potential breakthrough in aging and life expectancy that could change all of the rules.
Increased life expectancy, a downward revision in long term growth of the US economy, retirement accounts ravaged by economic realities of the past few years and mounting US debt pose a terrifying outlook for the individual and the country. In this two part series,Zinger looks at the implications of longevity on politics and public policy. Decisions today will have far reaching implications for generations to come.
The Discussion:
Can you imagine a world without heart disease? How about the elimination of cancer, diabetes and Alzheimer’s disease? What about growing organs to replace defective organs? All of these medical miracles are potentially within our lifetime. Combine these medical advancements with improvements in nutrition and a healthy lifestyle and you could easily join the ranks of the One Hundred year old club. Once a rare group, Centenarians is now the fastest growing segment of the population.
For the individual American, the potential cost of retirement must be of concern. It will take far more savings and much lower spending to meet the potential cost of a life expectancy reaching100 years. Most Americans are in denial about how much it will cost for retirement. (click on link to see related article in a new window).
As our government takes on a greater role in our lives, and legislation is being crafted to deal with the costs of Social Security, Medicare,Medicaid, health care for all citizens, the government must legislate with an eye to the future. Government programs never seem to shrink in scale or cost. Whatever is legislated today, will most likely become larger and more costly over time. The escalating costs of programs, a rapidly aging population and the potential for radical change in longevity will have far reaching cost implications. Add to this a government with political will geared to appeasing and we run the risk of failing to deal with real problems.
Societal programs are built around a growth model. The assumption is that the population will grow, incomes will grow and the tax base can grow to sustain programs into the future. However, we are entering an era where the growth model can no longer be counted on to sustain government taxes. Therefore, we must look to changes in the core of the these programs.
Social Security:
When Social Security was enacted in 1935, the country was trapped in a sustained Depression. Life long financial security for Americans was apolitically popular notion. When first enacted by President Roosevelt,there were ten workers contributing to the system for each beneficiary. Currently, there are three workers for every beneficiary and as the population ages, and life expectancy increases, we could see a 1:1 ratio within the next two generations. Before this happens, we must undertake dramatic changes to avoid a total collapse of the system. Lower benefits, and changes to retirement age must be adopted. Some predict the retirement age must increase to 75-80 within the next 10 years.
Medical Care and Medicaid:
For Medicare, the implications are more pressing. First enacted in 1965 as part of Lyndon Johnson’s Great Society initiative, Medicare was enacted to provide basic health care to the elderly. Over the years the benefits were increased and coverage was expanded. Medicare is about to go bankrupt. The Congressional Budget Office estimates that Medicare will be out of funds in less than eight years. It is critical that something be done to fundamentally change the costs.
Implications of Life Expectancy on Public Policy:
- Increasing life expectancy will increase the average number of years that beneficiaries receive social security payments, and therefore increases total lifetime costs.
- Increased longevity delays end of life but may not fundamentally change the medical costs of end of life unless there is active intervention in the death process.
- Extended life will increase the number of years that individuals are covered under Medicare and Medicaid and life long medical costs will most likely increase as a result.
- The primary cause of poor health is poor nutrition and lack of physical fitness, neither of which is a medical care issue, but rather a personal choice requiring intervention in personal lives to change.
The Conclusion:
There are three variables in social programs:
- Number of people covered: a function of births, life expectancy, and immigration policy.
- How long they are covered: Time limits of benefits, life expectancy.
- Benefits offered over the life of the program.
Let's assume we can no longer pay for social programs through government debt (like George W.Bush did with the Medicare Prescription Drug Program) and all programs must be budget neutral.
Therefore:
Taxes Levied = Taxes Needed
To simplify the analysis, the cost of any social program is the function of three variables and tax revenue is a function of three variables:
Taxes Levied = function of economic growth, income and tax rate
Taxes Needed = covered lives x cost of benefits x time covered
Taxes Levied = Taxes Needed
econ. growth rate x income x tax rate = covered lives x cost of benefits x time covered
The next ZingerKing will look at the math and the implications for public policy on Medicare, Medicaid, Social Security, population growth,abortion and further dependence on the government for our future financial and medical security.
Who Said It:
George Burns who lived to age 100
"If I Knew I Was Going To Live So Long I Would Have Taken Better Care Of Myself."
Today’s ZingerToon:
Recent ZingerKing Articles:
Articles can be found under “Recent Articles” in the purple sidebar. Older articles can be found in the archives that are stored by month. These are found at the bottom of the purple sidebar. Here is a list of the most recent articles.
Zingers Alternative For health Care Reform
The Tug Of War Of Special Interest Groups and Health Care Reform
Credibility Of The Administration Is Challenged
Taming The Angry Mobs
Creating A Free Market Alternative to Government Health Care
Cash For Clunkers
Culturalism versus Racism in America
The Revolving Door of Politics: Franken, Palin, Biden
Consequences of Taxing the Wealthy
Obama's Clintonesque Moment
Overcoming Bias: Challenging Our Own Beliefs
Health Care Just Made Me Sicker
Shameless Request For Support:
ZingerKing operates without advertising or government funding (obviously). The purpose is to inform and educate its readers about economic and political issues that affect our lives.
Help ZingerKing grow. Have you Zinged someone lately? Please forward a link to ZingerKing to a friend, family member or neighbor. If you enjoy reading the Zinger please subscribe (see the subscribe box at the top of the article in the purple side band). Subscribers receive the"Morning Briefing" when published with a link to the full article. Periodic alerts are sent to subscribers only with important updates and insights into critical issues. Your email address will not sold to others and will not be shared.
Posted by ZK at 8/27/2009 3:20 PM 
Categories: Obama Administration, economy, Taxes, Social Issues, Healthcare, Caretaker Government
Categories: Obama Administration, economy, Taxes, Social Issues, Healthcare, Caretaker Government
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