Bernanke Warns: Trouble Ahead For Medicare And Social Security
"Federal Reserve Chairman Ben S. Bernanke warned Wednesday that Americans may have to accept higher taxes or changes in cherished entitlements such as Medicare and Social Security if the nation is to avoid staggering budget deficits that threaten to choke off economic growth," The Washington Post reports. "'These choices are difficult, and it always seems easier to put them off -- until the day they cannot be put off anymore,' Bernanke said..." Bernanke's "remarks highlighted the difficulties posed by funding these entitlement programs over the long term. With the population aging and medical costs rising faster than inflation, Medicare is set to become a major drain on the federal budget in the coming decades, though the recently passed health-care bill has delayed the date when the program will begin to require big infusions of cash" (Irwin and Montgomery, 4/8).
The New York Times: "Mr. Bernanke, speaking before the Dallas Regional Chamber... made it clear that he did not expect the federal government to raise taxes or cut spending anytime soon. But he spoke about the budget pressures posed by Social Security and Medicare with greater urgency than he has in the past." The Times quotes Bernanke as saying: "To avoid large and unsustainable budget deficits, the nation will ultimately have to choose among higher taxes, modifications to entitlement programs such as Social Security and Medicare, less spending on everything else from education to defense, or some combination of the above" (Chan and Hernandez, 4/7).