The Greek debt crisis slammed our markets, but what does Greece's story have to do with our own? Robert Samuelson links debt crises with social insurance for the elderly:
Developed countries represent about half the world economy; most have overcommitted welfare states. They might defuse the dangers by gradually trimming future benefits in a way that reassures financial markets. In practice, they haven't done that; indeed, President Obama's health program expands benefits. What happens if all these countries are thrust into Greece's situation? One answer -- another worldwide economic collapse -- explains why dawdling is so risky.
It's true that if we canceled Medicare and Social Security today, we would have nothing resembling a deficit crisis. But it's not useful to knock President Obama's health program here. Our long-term entitlement crisis is a medical inflation crisis, and health care reform -- while far from a revolutionary and disruptive attempt to transform our delivery system -- put in place major efforts to target inflation, like the independent Medicare counsel and the innovation center, that didn't exist before.