The ratio of people aged 20- 64 to those 65 and older is projected to fall from 5.1 to 1 in 1980 to 2.8 to 1 in 2030, reflecting the general condition that there will be far fewer workers to support the number of entitlement recipients. Proponents of imposing gradual constraints on these programs feel that to leave their growth unchecked would ultimately require higher taxes that would severely strain the economy. They contend that the levels required would be prohibitive and would limit the taxes the government could levy to cover the costs of its many other functions or pressing new functions that may emerge in the future. They worry that the Nation s savings rate is much too low, in part because the federal government has borrowed so heavily from the financial markets. Given that discretionary programs represent only one-third of federal spending and already have been capped through FY2002, they feel that entitlements are the only logical place to look for additional constraints.
Entitlements are where the money is.
Simply put, these proponents feel that entitlements are too big to ignore. Still others point out that irrespective of any general concerns about entitlements, Social Security and Medicare have their own financing problems. The Social Security funds would be insolvent by 2029. Hence, these proponents argue that Social Security and Medicare need to be altered, if only to deal with their own financial inadequacies. They argue that steps need to be taken today so that whatever is done can be phased in slowly, thereby giving today s workers time to adjust a lifetime of expectations about their retirement and what these programs will provide them.