No cure for generational pain

Posted: Sep 08, 2000 12:00 AM
If you thought the public uproar over George W. Bush's use of an expletive last weekend was big, imagine the national horror he would have provoked if he had said he was against offering any new Medicare benefits for the elderly. Al Gore wants to throw $250 billion at seniors to add a universal prescription drug benefit to Medicare. Bush would spend $160 billion to fully subsidize drug coverage for the elderly poor and partially subsidize the Medicare premiums for all other recipients. Both candidates want to be the voice for seniors. Nobody wants to speak for us younger folks who will be forced to foot these enormous bills. Free-lunch politics is a hard habit to break. The nightly news is filled with heart-wrenching stories of older Americans who must pay for expensive pain killers and heart medication. One CNN reporter highlighted the plight of 75-year-old Bernice, who has osteoporosis, and her 78-year-old husband Syd, a retired doctor himself with a thyroid condition. "Their annual total for prescription drugs: $3,336," the reporter intoned. "After insurance, that's $2,200-plus out of pocket." What the reporter failed to note is that Bernice and Syd's case is extremely atypical. According to the non-partisan National Academy of Social Insurance, only 4 percent of Medicare recipients have expenses that exceed $2,000. The median out-of-pocket expenditure on prescription drugs for Medicare enrollees is just about $200. Syd says his personal crisis demonstrates the need for a universal health care system that provides drug coverage "for everybody." But two-thirds of seniors already have prescription drug coverage. Why should every elderly person feel entitled to have someone else to pay for their medicine, anyway? Why should we workers be expected to fork over more of our paychecks to expand Medicare when this socialized health insurance entitlement program remains structurally unsound? Prescription drug pushers point to healthy trust funds as their cash source. But the Medicare trust fund, like its Social Security counterpart, is illusory. What matters is the Hospital Insurance program's operating balance. That portion of Medicare is laying out more money each year than the Medicare portion of the payroll tax receives. Costs also are escalating in the non-hospital part of the program, financed by premiums and general revenues. The senior lobby says this country treats retirees inhumanely. It paints a bleak picture of millions of old people living on Spam in order to pay for drugs. Yet, statistics show that elderly household income per capita is on par with the national average. That's pre-tax income upon which the elderly enjoy huge breaks. When you include in-kind benefits like Medicare -- a Cadillac plan compared to what the rest of us in the private market can afford -- the elderly poverty rate is as low as the rate for any age group and half the rate for children. And for all the apocalyptic rhetoric about shortchanging seniors, federal spending on the elderly comprises more than one-third of the national budget. As the Concord Coalition points out, that doesn't even include retirement benefits to the near-elderly and to civil service and military pensioners. I firmly believe we owe a debt of gratitude to the Greatest Generation. But we don't owe them -- or the Boomers -- the kind of bottomless debt that redistributionist panderers Gore and Bush are proposing. Government benefits for the elderly will eat up a whopping 84 percent of budget outlays by 2050 without cuts in Medicare and Social Security spending. Who will raise their voices for young workers? Former Republican Sen. Alan Simpson of Wyoming, an adamant critic of the elderly entitlement explosion, left office in 1996. Democrat Sen. Bob Kerrey, another entitlement reformer, announced his retirement earlier this year. Only diehard policy wonks listen to the Concord Coalition. And today's clueless spokespeople for youth -- like Karenna Gore and George P. Bush -- haven't paid enough in payroll taxes to buy two cans of Spam. There's no one left to champion a cure for our impending generational pain. The Republicans have learned you can't speak up for generational equity anymore without being accused of elderly-bashing. Fiscal responsibility is not simply passe. It's profane.