Common Dreams NewsCenter

We Can't Do It Without You!
 

Home | About Us | Donate | Signup | Archives | Search

Home > Progressive Community > NewsWire > For Immediate Release
   
Printer Friendly Version E-Mail This Article
   
Center for Economic and Policy Research
FOR IMMEDIATE RELEASE
MARCH 24, 2005
2:38 PM
CONTACT: Center for Economic and Policy Research  
Debi Kar, 202-387-5080
 
Health Care Costs Pose a Larger Economic Burden Than Prospective Social Security Tax Hikes
 

WASHINGTON -- March 24 -- Numerous politicians and commentators have claimed that the prospect of higher Social Security taxes in the future will threaten the living standards of our children and grandchildren. A new report from the Center for Economic and Policy Research (CEPR), which was co-authored by Dean Baker and David Rosnick shows that rising health care costs pose a much larger threat to living standards than any potential tax increases for supporting Social Security.

The report, “The Burden of Social Security Taxes and the Burden of Excessive Health Care Costs,” shows that the burden of excessive health care cost growth (defined as cost growth in excess of economic growth) over the years 1980 to 2004 was almost 7 times as large as the tax increase that the Social Security trustees project will be needed to keep Social Security fully solvent over its 75-year planning horizon. The excessive health care cost growth over this period imposed a burden that is 18 times as large as the tax increase that the Congressional Budget Office (CBO) estimates would be necessary to keep Social Security solvent.

Furthermore, health care costs are projected to continue to grow far more rapidly than the economy. The Center for Medicare and Medicaid Services projection for excessive health care cost growth over the next decade is 4 times as large as the tax increase that the trustees project is necessary to keep Social Security solvent for its 75-year planning period, and 10 times as large as the tax increase that CBO projects is necessary.

While health care costs pose a problem everywhere, no other country has such a failed health care system. The United States pays more than twice as much person for health care as other wealthy countries, yet it has shorter life expectancies. Rising health care costs pose an enormous threat to the federal budget, as was illustrated in the new Medicare trustees report, but more importantly they pose a threat to the economy and future living standards.

Given the large amount of attention devoted to the threat of higher Social Security taxes in the future, it is striking that the continuing run-up in health care costs – which is having a much larger impact on most workers’ welfare – is receiving so little attention.

The full report is available at:
http://www.cepr.net/publications/ss_hc_2005_03_24.pdf.

The Center for Economic and Policy Research is an independent, non-partisan think tank that was established to promote democratic debate on the most important economic and social issues that affect people’s lives.

###

Printer Friendly Version E-Mail This Article
Common Dreams NewsCenter is a non-profit news service
providing breaking news and views for the Progressive Community.

The press release posted here has been provided to Common Dreams NewsWire by one of the many progressive organizations who make up America's Progressive Community. If you wish to comment on this press release or would like more information, please contact the organization directly.
*all times Eastern US (GMT-5:00)

Making News?
Read our Guidelines for Submitting News Releases

CommonDreams.org is an Internet-based progressive news and grassroots activism organization, founded in 1997.
We are a nonprofit, progressive, independent and nonpartisan organization.

Home | About Us | Donate | Signup | Archives | Search

To inform. To inspire. To ignite change for the common good.


www.commondreams.org