This point isn't old, but it bears repeating: Our deficit is set to skyrocket in the next ten years and the groundswell is coming almost entirely from health spending. Matthew Yglesias points out a new report from the Center on Budget and Policy Priorities about health care and the deficit. I know, I know! You've heard this song before. The first verse ends with a graph, and the chorus is me whining in high(-minded) falsetto about growing deficits. But the CBPP's cover puts a nice spin on how health care inflation hurts both the government's pocket and our ability to pad the government's pocket.
From the study:
Long-term revenue projections. Our revenue projections largely follow CBO's alternative fiscal scenario, which assumes extension both of the 2001 and 2003 individual income tax cuts and of AMT relief. In addition, our numbers -- like CBO's -- assume a decrease in revenues due to increased private health care spending: as health care costs rise, workers are likely to receive more of their compensation in the form of tax-exempt health care benefits and less in the form of taxable wages, so total revenues decline. But because we project that excess cost growth in other health-care spending will mimic that in Medicare and Medicaid, whereas CBO estimates it will be somewhat lower than in those programs, our revenue estimates are lower than CBO's.
And now that I have you: A graph!
There are two things to say about this graph. The first, to join Yglesias in unison, is that the country is stuck between a rock called health care inflation and hard place called the political impossibility of raising taxes or cutting benefits to the elderly. To call for higher taxes is to invite accusations of socialism, and also never to be reelected. To call for cutting benefits to the elderly is to invite accusations of forced euthanasia, and also never to be reelected.
The second thing to say is that any time you hear somebody say "There is no health care crisis," or "If anything we have a Social Security crisis," please print out this graph and ask them to describe what they see.
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