For anyone who followed this thread, I was going to post this article for Foreign Policy magazine’s take on the subject. (Basically, what would happen if the US did not, as is often claimed, pay for the defense of the world.)
But there was a quote towards the end of the article that I thought deserved a discussion of its own:
What do you think? Am I hastening a future of anarchy by supporting national healthcare?
An interesting although not quite on-topic issue is Medicaid. Medicare is primarily for people who are either over 65, have end-stage kidney disorder, or who are receiving benefits under certain other SSA programs.
Medicaid is medical coverage for the poor, and is managed and funded to a large degree by the states. In the 1980s Ronald Reagan proposed an interesting plan, he said the Federal government would take over Medicaid and take care of all the funding, and the states would be responsible for welfare (food stamps, aid to families with dependent children etc.) The states and congress didn’t really hop on board for that.
What’s interesting is if that had been done we’d be a lot closer to a national health care system than we are right now because Medicare (for the elderly) and medicaid (for the poor) would both be federally funded and managed and part of an expanded national health care system.
The states would have been wise to take up Reagan’s offer since now they foot a good bit of the bill for medicaid AND welfare.
The thing is, while the U.S. is certainly picking up an increasing burden of care for the elderly, so is every other country. If you want to see where the real disaster is going to come, have a look at Europe. Their birthrates are lower, their benefits much higher, and their population is already older. In addition, while America’s economic growth is high enough that it can grow its way out of the problem, growth in Europe is becoming stagnant.
The implosion of Europe will be the biggest story of the next 30 years.
I doubt that domestic entitlement programs are really going to cripple US military spending any time within the next 30–50 years. Medicare, which is where benefit costs are projected to seriously skyrocket, will probably be folded into some kind of single-payer program that restricts health-care costs. And Social Security will probably get by for at least the next several decades with “tweaks” such as reducing early-retirement benefits and raising the payroll tax cap. In any case, we have enough slack in our tax system to allow for cushioning short-term funding crises, if any become really severe, with modest upper-bracket tax increases.
In short: definitely something to think about, but not a harbinger of inevitable impending doom doom doom.
I’m also skeptical about Sam’s catastrophic though vague predictions of a full-scale economic “implosion” of Europe in the next few decades. Yes, many European countries do currently have a serious mismatch between the projected costs of social benefits for their aging populations and the projected demographic ability to support those costs. But that doesn’t mean that they’re automatically doom doom doomed to suffer the projected consequences. Some of the countervailing factors include:
Greater mobility for members of demographically younger European countries more recently admitted to the EU (possibly including, a decade or so from now, Turkey) whose immigrants will shore up social support systems in the older countries.
Greater social willingness for benefits rationing in, e.g., end-of-life care, where most of the major increases in geriatric medical costs occur.
Political will to make temporary benefit cuts in periods of genuine funding crisis, and to adjust benefit programs to conform to demographic realities. For example, consider the experience of prototypical-welfare-state Sweden in the tough economy of the 1990’s:
So I’d need to see a lot more evidence before I assumed with Sam that current European demographics are bound to lead to economic “disaster”.
Okay, let me qualify that - If present trends continue, Europe is heading for a big problem. I suppose it’s possible that Europe could institute drastic reforms and stave off the problem, but I don’t know how likely that is. In a couple of decades, there will be less than 2 workers per retiree on average in the EU zone. That’s not sustainable. So either there will have to be dramatic benefit cuts, or a dramatic increase in the retirement age, or a dramatic increase in immigration.