America's Social Security: Running on Empty

The Social Security Administration in the United States is about to exhaust. According to the Social Security Medical Insurance Committee, "The long-term plan cost of health insurance and social security in planned financing is unsustainable, and in order to avoid catastrophic consequences for beneficiaries and taxpayers According to other evidence, "From 2022, the assets of the trust fund will exceed the interest income until the funds reserve funds are used up in 2036." It will be redeemed at the forehead. "

Three major US rights programs, Social Security, Health Insurance, and Medicaid, consume large amounts of mandatory expenditure. In the case of the aging population in the United States, pension and medical expenses will increase sharply. According to a social security trustee's report, the US public pension system is expected to bankrupt in 2034. According to the Ministry of Finance (report of 2016, p. 63), the total non-financial liabilities for social security and medical insurance is $ 46.7 trillion, three times the total federal debt owned by public institutions.

The reality of social security expenditure in Latin America at the beginning of the 21st century is that it is still moving backwards. Most of the social security expenditure is used for pensions and the rest are used for paying other transfers such as family allowances and childbirth benefits. In most countries, compensation for social security is limited to employees in formal sectors. In other words, 20% to 60% of the active population is still excluded. De Ferranti et al. (2004: 268-72) reviewed a series of studies that found that the component of the return on social security spending outperformed the gradual component in the research by the World Bank. Lindert et al. (2005) confirmed this evaluation based on the analysis of micro data.

Although the US social security system may be actuarial, the state of the government's retirement system in many other countries of the world is much worse. * As shown in Figure 3, the World Bank calculated that the debt of the US system without funds was considerably lower than the other major industrialized democratic liabilities a few years ago. ** The situation in the former Soviet bloc countries is getting worse. When they try to eliminate socialist heritage by promoting growth, their economies suffer from payroll tax (usually more than 30%) and need to support government retirement plans.