The GOP Mantra: Medicare Broke in Nine Years?


A Republican bobblehead I saw on television last night kept repeating the mantra that “The CBO says Medicare will go broke in nine years.” I googled for this, and all I got were a bunch of quotes from Republicans saying the CBO says Medicare will go broke in nine years, with no links to a source at the CBO. It’s an unsourced talking point, in other words.

I assume that some worker drone in the right-wing think tanks was able to extract a claim that Medicare will go broke in nine years from some CBO document, but whether that’s what the CBO actually thinks is, of course, another matter.

I went to the Congressional Budget Office site and found no document explicitly saying that Medicare will go broke in nine years. I did find the “March 2011 Medicare Baseline” analysis, which to me might as well be written in Greek. If anyone can explain what these numbers are saying, I’d appreciate it. But I’m not seeing anything that jumps out at me and says Medicare will be broke after 2020 on this chart.

It’s obvious the “broke in nine years” claim is going to be a big factor in the Republicans’ defense for destroying Medicare. I wish someone with the time and expertise to follow up on this would figure out how and where they are getting this claim and what the CBO actually says.

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  1. c u n d gulag  •  Apr 16, 2011 @10:19 am


    Big deal!

    That’s 8 years after the world ends according to the Mayan’s – who are every bit as reliable as the Born-again Christians who wear clean underwear every day, even though they’re waiting to get raptured up to Heaven naked any day now.

    And I strongly suspect that they pulled that 2020 number from the same orifice that causes skid-marks on your BVD’s and panties.

  2. c u n d gulag  •  Apr 16, 2011 @10:43 am

    OT – but this latest from Matt Taibbi explains not only why we can’t have nice things, but why we have to cut or eliminate necessary things:

    Excuse me, I have to go and throw up.

  3. Gordon  •  Apr 16, 2011 @10:50 am

    On p 4 of the Medicare Baseline PDF, footnote e says: “The Hospital Insurance Trust Fund is projected to become exhausted in 2020. Accordingly, certain components of trust fund operations for the year of exhaustion and subsequent years are not meaningful under
    present law and are not shown in this table.
    ” That must be what they’re referring to. One relatively small component of Medicare appears to have been underfunded by maybe 30 billion / year.

    The CBO was very skeptical of the Medicare cost-control aspects of ACA, so there may not be a problem at all.

  4. maha  •  Apr 16, 2011 @11:27 am

    Gordon — yes, that must be what they are referring to. Thanks for helping to clear that up.

  5. goatherd  •  Apr 16, 2011 @11:41 am

    “I went to the Congressional Budget Office site and found no document explicitly saying that Medicare will go broke in nine years. I did find the “March 2011 Medicare Baseline” analysis, which to me might as well be written in Greek. If anyone can explain what these numbers are saying, I’d appreciate it. But I’m not seeing anything that jumps out at me and says Medicare will be broke after 2020 on this chart.”

    Echidne of the Snakes is an economist, do bloggers share insights with each other?

  6. Felicity  •  Apr 16, 2011 @12:25 pm

    I take any and all forecasting from economists of the economic future with a huge grain of salt. Fore instance, economics may be the only field where two people can get the Nobel for saying opposite things. And my favorite – an economist is a guy who can’t tell you tomorrow why what he forecast yesterday, didn’t happen today.

  7. erinyes  •  Apr 16, 2011 @2:20 pm

    In the course of my working life, I have been an ironworker, Commercial diver, pile driver, carpenter, and inspector. If I showed up at work and said I couldn’t do my job to MAKE IT HAPPEN, I’d be told to pack my shit and go home.
    This I say to the GOP; you were elected to MAKE IT HAPPEN, if you can’t, GO HOME!!!

  8. wmd  •  Apr 16, 2011 @2:27 pm

    If you look at the annual payroll tax income on page 4 and the annual deficits in the same section it jumps out that the deficits are >10% per year.

    The income figures should include the 2013 Medicare tax on unearned income passed as part of the Affordable Care Act, looking at year over year growth it looks like this income is in the chart:

    2010-2011 change 4.3%
    2011-2012 change 7.3%
    2012-2013 change 7.7%
    2013-2014 change 7.1%
    2014-2015 change 5.8%
    2015-2016 change 5.4%

    Higher growth in the first few years after unearned income is subjected to Medicare taxes makes sense, as compliance won’t be perfect initially. The year before the change is anomalous though.

    I’d expect 2011-2012 to have baseline growth – are earned incomes in 2012 expected to be a lot higher?

  9. Comrade Rutherford  •  Apr 16, 2011 @8:18 pm

    Ultimately, it doesn’t matter where they got that talking point. If Fox ‘News’ says it, then it IS true, and no facts, truth or reality can shake the fervent belief in the far-right extremists.

    This is why the GOP can openly vote to kill off Medicare: because the US media will dutifully report that it was the Dem’s fault and the GOP was valiantly trying to save it to no avail.

    It’s that scene in ‘Wag the Dog’ when Dustin Hoffman’s character is astounded at the idea of faking ‘the appearance of a war’. He looks out his picture window and asks ‘What if they find out?’ (‘they’ being the average citizen). Robert DeNiro replies, ‘Who’s gonna tell ’em?’

  10. maha  •  Apr 16, 2011 @10:58 pm

    Ultimately, it doesn’t matter where they got that talking point.

    It’s important to me, in case I’m ever called upon to explain why it’s a lie.

  11. ronspri  •  Apr 16, 2011 @8:23 pm

    When they say that it is not meant as a statement of fact. Ya know.

  12. dyedinthewoolliberal  •  Apr 16, 2011 @10:44 pm

    3%, 90%, 9 years, 90 years, all the same thing really, right? The word ‘fact’ seems to have morphed into nonsense. Maybe we need a new word, factiness or fact-light or fact made up out of hot air.
    (Matt Taibbi article a must read.) Try it on an empty stomach, less messy c u n y gulag! A new positive effect of the new economy.

  13. Peter John  •  Apr 17, 2011 @1:04 am

    Social Security and Medicare funding can be increase by just increasing the average wages of workers. This can be done by increasing the minimum wages. Changing overtime from time and half to double time. And by making Overtime mandatory for everyone except Corporate Officiers.

  14. maha  •  Apr 17, 2011 @7:19 am

    And by making Overtime mandatory for everyone except Corporate Officiers.

    Mandatory overtime? Are you daft?

    Social Security isn’t in that much trouble and could be largely put right simply by eliminating the cap on taxable wages. Ultimately the only thing that’s going to fix Medicare is to get health care costs under control. Rising wages would be just the thing to stimulate the economy. Forget the mandatory overtime, though.

  15. goatherd  •  Apr 17, 2011 @8:40 am

    Felicity was right on the money about economists.

    But, unfortunately, we rarely get even to the point of hearing two economists presenting their opposing cases. Even NPR had Paul Ryan on explaining his budget proposal following an opposing view presented the day before. But, neither person was an economist. Think tanks and politicians aren’t going to present objective truth, but that is all we get, even in the best of our media.

    Economics is an area where few of us have a true grasp on reality. As Felicity pointed out, maybe none of us do. But, it seems theoretically possible to present opposing views from qualified people and to check their facts. This virtually never happens. As it was the media barely stopped to catch their breath between the midterm elections and covering the horse race for 2012. So all we get is distortion and posturing. Maybe if enough of us called in to request fact checks about specific statements some of the better sources like NPR would respond. (Yeah, I am delusionally naive. I have to cope somehow.)

    I want to thank you all for shedding some light on the CBO report. I will have to try to wade through it when I find the time.

  16. Ian  •  Apr 17, 2011 @10:25 am


    I think he just meant to make it mandatory that IF you work overtime, THEN you get overtime pay.

    Would only work for hourly workers, of course.

    And, really, not all of even them. I’m programmer, you know, and when I used to work as a contractor, I never got overtime pay … would have been prohibitively expensive for my company to pay me that much. It would have basically made fixed bid contracts too economically risky to enter into, they’d have to stick with time&materials … which a lot of companies don’t want to do because it doesn’t put an upper limit on the price tag of a project.

    Still, would be worthwhile to make overtime pay be mandatory for, like, factory workers and the like.


  17. Theo  •  Apr 17, 2011 @11:43 am

    Ian, I understand your point regarding salaried employees. However, I consider it fraudulent for companies to knowingly underestimate the effort on contracts to keep costs low and then to make their profits by forcing employees to work ungodly, unpaid numbers of hours to complete projects on time and “under budget”.

    The Air Force division at my former company routinely worked 70-hour weeks (although the head of the division found ample time to play fantasy football at work) and were proud of it. That seems cool to the young and single employees, but it gets old real fast as you gain more experience, have other responsibilities, and tend to view these working conditions with a jaded eye.

  18. Felicity  •  Apr 17, 2011 @11:45 am

    “Rising wages would be just the thing to stimulate the economy.” Percent change in US labor productivity since 1972 (a time of great American prosperity): +114. Percent change in wages during that same period: -6. (Harpers Index, May issue)

    Percentage of GDP that will be taken as federal revenue this year: 14.8. Last year in which the percentage was this low: 1950. I don’t really understand this statistic, but it sounds important. Explanation anyone?

  19. Jennifer  •  Apr 17, 2011 @12:05 pm

    Stupid question:
    a) even if medicare went broke in 9 years, tell me why we would want to dismantle it now?
    b) I’m doing my taxes (nothing like last minute, but I’m self-employed) and have to pay SE tax. That’s medicare and social security. If we pay these separately, why are they on the table for balancing the budget?
    c) I agree with Maha that eliminating the cap on taxable wages is necessary. The cap is ludicrously low.
    d) I thought hourly workers always were paid overtime. That was what hourly meant. I can’t imagine demanding work from my employees that isn’t compensated. As a salaried worker, I was allowed to take comp time because they didn’t have much money (I was paid from scientific grants in a University).

  20. Gordon  •  Apr 17, 2011 @4:28 pm

    Felicity – that’s just taxes / GDP. Fed gov’t spends maybe 22% (inexact) of GDP in normal times. Recession comes (so GDP goes down or stays flat), and gov’t owes lots of unemployment insurance payouts (so spending goes up), so spending as % of GDP goes way up and Righties scream that Obama is having caviar and coke parties at the WH.

  21. Felicity  •  Apr 18, 2011 @1:52 pm

    Thanks Gordon, and now I know why I avoided all classes having anything to do with economics at university. So the rise in government spending (in relation to GDP) is due to all the money the government is shelling out to pay for Obama’s caviar and coke? Got it. Except, 1950, if I remember correctly we were not in a recession. I’m confused.

  22. maha  •  Apr 18, 2011 @3:28 pm

    I am certain I took economics 101 as a sophomore, but I recall absolutely nothing about the class except that the teacher was some middle aged white guy.

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