Putting a Stake Through the Retirement Age Zombie

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A few days ago I wrote about the perennial popularity of raising the retirement age for Social Security and Medicare. It’s a bad idea that doesn’t save very much money, is savagely unfair to the poor, and in the case of Medicare, does nothing to rein in cost growth, which is our biggest problem. But it’s an easy sound bite, so it sticks around forever even though there are loads of better ways of addressing entitlement spending.

Here’s a nice little chart from CBPP (based on data from the Kaiser Family Foundation) that illustrates this for Medicare. Here’s what it shows:

  • If the Medicare eligibility age were raised to 67, it would produce net savings of $5.7 billion. That’s a whopping 1% of total Medicare spending. The reason the number is so low is that a lot of 65-66 year-olds would end up on Medicaid or in Obamacare’s subsidized healthcare exchanges. The feds pay either way.
  • But wait! Although the federal government would save a bit of money, employers would end up spending $4.5 billion more and seniors themselves would spend $3.7 billion more.
  • In the end, the federal government would end up with only tiny savings, and those savings would be more than made up by higher spending elsewhere. The net effect on the healthcare system as a whole would be an increase of $5.7 billion, not a decrease.

This is just a bad, bad, zombie idea. It might be worth arguing over the methodology here if the numbers were big enough to matter, but they aren’t. Even in the best case, raising the Medicare eligibility age would have an insignificant effect on the federal budget.

The more time we spend on this, the less time we’re spending on ideas that might actually accomplish something. It’s time to move on.

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Fact:

In-depth journalism that investigates the powerful takes real money and is so damn important right now.But it doesn’t take a Mother Jones investigation to know that billionaires and corporations will never fund the type of reporting (like they do politicians) we do that exists to help bring about change. Instead, our mission-driven journalism is made possible by people power, and has been for 46 years now since our founding as a non-profit.

In “TITLE TK” Monica Bauerlein writes about the perilous moment we’re in, and why it’s so important that we raise $325,000 by the time November’s midterms are decided so we can be ready to throw everything we have at the big issues facing the nation no matter what happens. Please help MoJo’s people-powered journalism with a donation today.

$400,000 to go!

payment methods

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