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US Treasury chief says Social
Security 'unsustainable'
AFP
Wednesday, March 26, 2008
US Treasury Secretary Henry Paulson said Tuesday that America's
Social Security program for the retired is "financially unsustainable"
and needs an urgent overhaul.
Paulson, speaking after a government panel had completed its
annual assessment of the Social Security and Medicare benefits
programs, said waves of retiring Americans threaten to soon deplete
available funds stockpiled in the two programs.
"As the baby boom generation moves into retirement, these
programs face progressively larger financial challenges,"
Paulson said.
The Treasury secretary said a growing number of retirees and
the programs' rising costs could harm America's future prosperity
if Social Security and Medicare are not overhauled and bolstered.
(Article continues below)
The needs of the Social Security program, which provides retirement
benefits to all Americans as long as they have contributed to
the program, are less acute, however, than Medicare.
Paulson said the Social Security program's cash flows are projected
to turn negative in under 10 years and that a Social Security
trust fund would likely be exhausted in 2041 without urgent reform.
Social Security's unfunded obligation, the difference between
the present values of Social Security inflows and outflows less
the existing trust funds, equals 4.3 trillion dollars over the
next 75 years and 13.6 trillion on a permanent basis, according
to the Treasury.
Medicare, which pays medical bills for retired Americans, is
facing bigger financial challenges because of soaring health care
and drug costs.
Full
article here.
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