Where Does the Money Go?

I'm almost done reading "Where Does the Money Go? Your Guided Tour to the Federal Budget Crisis" by Scott Bittle and Jean Johnson. This book is a real wake-up call. Written in (early) 2008, it's full of relevant information concerning government spending and taxes. Well worth the read.

One of the book's focuses is the Social Security program, and the bleak future we can expect from it. When Social Security was installed back in the 30's, the average life expectancy was 62. Today it's 77. The baby boomers (the generation, born in the 50's, that's heading into retirement right now) are the biggest generation since the program started. And, since Social Security is pay-as-you-go, we're heading into some deep waters. Couple that with the fact that the Social Security pot is full of nothing but government IOU's (treasury bills), we can expect some tax reform and/or some benefits reform in the next few years.

But even better news is Medicare, which is paying out more than it's taking in TODAY, and the projections for the next 40 years are very scary. People are living longer, sure, but they're also living sicker. Healthcare costs are up, even for Uncle Sam.

The National Debt is another hot-button we really need to watch, especially in light of the last few weeks. Right now China owns a bunch of treasury bills, they're a country that's not exactly in our friendship circle, and they just watched the Wall Street debacle. If they decide to start pushing their money elsewhere, what we've seen the last few days will be mere hiccup. None of our presidents-to-be are discussing the national debt and how they plan to approach it, they're too busy yammering about healthcare and the economy (both important, but so is the money we owe).

Just some high(low)lights from the book. If you have a minute, pick it up at the library. Thankfully it's not a boring read, it's written by people from Public Agenda Online, so the language is very user-friendly. Not like you need anything else to worry about right now, but knowledge is power.