-The article was originally published at The Daily Caller and was co-authored with Kavon W. Nikrad.
With the release of House Budget Committee Chairman Paul Ryan’s (R-WI) proposed 2012 budget, Washington is abuzz with support, attacks, praise and ridicule. Above it all, however, is the fiscal disaster that Ryan is trying to avoid with his proposal. As Ed Morrissey noted in a recent presentation at The Heritage Foundation, everyone in Washington knows that entitlements need fixing and fast — they simply choose to ignore it, or they did until Ryan’s budget came out.
Absent significant reform to entitlements and Defense Spending (about two-thirds of today’s spending, and growing), young workers can expect to pay a historically unprecedented percentage of their income toward the National Debt. Two major drivers of this debt are Social Security andMedicare, currently 34% of the budget. With 10,000 people retiring every day for the next 19 years, and the current 31 million retirees expected to grow to at least 51 million by 2030, these programs will indeed grow significantly.
Many Democrats, such as Senate Majority Leader Harry Reid (D-NV) and Rep. Anthony Weiner (D-NY) want to pretend Social Security is fine, since it has $2.5 trillion in assets. Unfortunately, those assets are the same IOUs the federal government owes China, Japan, bond holders and others. Should the U.S. economy follow the path of Napoleonic France, Rome, and the USSR into failed fiscal policy collapse, those IOUs will be worth less than the paper they are printed on.