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It's official: Washington is Bankrupt
July 22nd 10:48:12 AM
Advocates of the status quo cringe when reformers call Social Security’s incipient fiscal imbalance a “crisis.” So what would they think of the Federal Reserve Bank of St. Louis, which has recently concluded that the federal government, because it has promised through entitlement programs much more than it can conceivably pay, is bankrupt (see NCPA piece)?
The author of the study, Boston University economics professor and National Bureau of Economic Research associate Laurence J. Kotlikoff, argues that to save the system, Congress can either double personal and corporate tax rates, slash Medicare and Social Security by two-thirds, or open up the system to personal (yes, private) investment.
Of course, in terms of popular legislation, privitazation is no GI Bill. But in light of the alternatives--major tax hikes, or debilitating benefit cuts--couldn't even the AARP stomach personal accounts?
Posted by Ryan Walsh
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