The recent enactment of the Social Security Fairness Act, which increased retirement benefits for 2.8 million public sector workers at the cost of $196 billion, foreshadows what Americans can expect of entitlement reforms in the future, an economist warns.
“The main trend that we’re observing is that politicians in Washington are far less willing to consider trade-offs, and far more motivated to bestow new benefits and handouts to favored groups, without considering the long-run fiscal implications of those actions,” Romina Boccia, director of budget and entitlement policy at the Cato Institute, told The Center Square.
The Social Security trust fund is set to become insolvent in seven years, resulting in a 20% to 25% automatic cut in benefits unless Congress acts.
The main problem, Boccia said, is that lawmakers would rather take harmful but politically popular actions – such as the Social Security Fairness Act – rather than reduce the deficit and make serious reforms.
As the insolvency deadline looms, politicians will likely try to take the easy way out, such as ignoring the trust fund depletion and authorizing unlimited borrowing, ultimately leading to a fiscal crisis, she said. […]
— Read More: justthenews.com
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