Friday, January 07, 2005

Latest So-Wacky Scheme To Save Social Security...

Make it an arm of the Defense Department!

[by Dean Baker] Those of you who are concerned about the $10.4 trillion Social Security shortfall in the infinite horizon have no doubt been wondering how we will meet our defense obligations in the 22nd century. I just did a simple calculation in which I asked how much it will cost the U.S. to always be the world's pre-eminent military power. This means that we will presumably always have to spend at least as much on our military as the next largest military power, which will presumably be China.

....In the weak China scenario, the defense shortfall over the the infinite horizon is equal to $33.4 trillion, more than 3 times the projected SS shortfall. In the strong China scenario the defense shortfall is equal to $54.1 trillion, almost five times the projected SS shortfall. The moral of this story is that if the Bush people are set on always having the U.S. be the strongest military power in the world, the SS shortfall will be chump change compared to the money they will need.

Meaning that Social Security will have to compete with Defense, Agriculture, Health and Human Services, Housing, Education.... Directly compete. It won't survive that in its current mode.

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