WASHINGTON (Dow Jones)--Any move by Congress to overhaul the Social Security program without addressing the shortfalls in the other entitlement programs wouldn't come close to resolving the fiscal crisis the U.S. is facing, the co-chairman of a White House deficit commission said Tuesday.
Erskine Bowles, who was White House chief of staff during the Clinton presidency, told a Senate panel that moving forward with changes to Social Security without also tackling Medicare and Medicaid wouldn't make any sense.
"If we only do Social Security, we don't come close to solving the problem," Bowles said in testimony before the Senate Budget Committee.
Bowles, along with former Republican Sen. Alan Simpson (R., Wyo.), led a commission established last year by the White House to compile recommendations to deal with the potential fiscal time bomb the federal government is confronted with.
He told lawmakers on the panel that addressing just Social Security would be akin to only dealing with discretionary spending by the federal government.
"If you got rid of all discretionary spending, you would still have a $1 trillion deficit this year," said Bowles.
-Corey Boles, Dow Jones Newswires
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Showing posts with label Social Insurance. Show all posts
Showing posts with label Social Insurance. Show all posts
Tuesday, March 08, 2011
Sunday, December 26, 2010
Coburn: Control Government Spending or Face 'Apocalyptic Pain'
"Apocalyptic pain" from an out-of-control debt could cause 18 percent unemployment and a massive contraction in the economy that would destroy the middle class, a leading Republican deficit hawk said in an interview that aired Sunday.
Sen. Tom Coburn, R-Okla., who recently issued a report on government waste, warned that the U.S. only has about three or four years to get its fiscal house in order or it could find itself facing austerity measures seen in Greece, Ireland, Spain, Portugal and earlier in Japan.
"The problem that faces our country today, the last 30 years we have lived off the future, and the bill is coming due," he added.
The senator, who was recently elected to a second -- and he pledges -- final term in Congress, said he's not trying to scare anyone, but eliminating waste in the federal government's ledgers is imperative not just to prevent default but a massive implosion that he defined in catastrophic terms.
Coburn said he can come up with $350 billion off the top of his head in inefficiency and waste that could be eliminated without impacting anyone in a practical sense. He noted $50 billion in programs that are duplicative and $100 billion in Medicare and Medicaid fraud that was not addressed in the health care law.
"We have 267 job training programs across 39 different agencies. Why do we have 267 of them? We have 105 programs to encourage people to go into science and technology, engineering and math. That's 105 sets of bureaucrats. None of them have metrics on it," he said.
"The Pentagon can't even audit its own books. It doesn't even know where its money is going. And we refuse to have the tough forces go on the Pentagon so that at least they are efficient with the money they're spending," Coburn added.
In one of his last acts in the lame-duck session that ended last week, Coburn, an obstetrician who earned the nickname "Dr. No" for his refusal to spend taxpayer dollars, was a critical factor in getting a health care program for Sept. 11 responders reduced in scope and cost. The $7.2 billion program was cut to $4.3 billion and was paid for through additional fees and reductions in other spending.
-FoxNews.com
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Sen. Tom Coburn, R-Okla., who recently issued a report on government waste, warned that the U.S. only has about three or four years to get its fiscal house in order or it could find itself facing austerity measures seen in Greece, Ireland, Spain, Portugal and earlier in Japan.
"The problem that faces our country today, the last 30 years we have lived off the future, and the bill is coming due," he added.
The senator, who was recently elected to a second -- and he pledges -- final term in Congress, said he's not trying to scare anyone, but eliminating waste in the federal government's ledgers is imperative not just to prevent default but a massive implosion that he defined in catastrophic terms.
Coburn said he can come up with $350 billion off the top of his head in inefficiency and waste that could be eliminated without impacting anyone in a practical sense. He noted $50 billion in programs that are duplicative and $100 billion in Medicare and Medicaid fraud that was not addressed in the health care law.
"We have 267 job training programs across 39 different agencies. Why do we have 267 of them? We have 105 programs to encourage people to go into science and technology, engineering and math. That's 105 sets of bureaucrats. None of them have metrics on it," he said.
"The Pentagon can't even audit its own books. It doesn't even know where its money is going. And we refuse to have the tough forces go on the Pentagon so that at least they are efficient with the money they're spending," Coburn added.
In one of his last acts in the lame-duck session that ended last week, Coburn, an obstetrician who earned the nickname "Dr. No" for his refusal to spend taxpayer dollars, was a critical factor in getting a health care program for Sept. 11 responders reduced in scope and cost. The $7.2 billion program was cut to $4.3 billion and was paid for through additional fees and reductions in other spending.
-FoxNews.com
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Monday, March 01, 2010
GAO: Federal financial picture is grim
It's an annual Washington ritual: The Treasury Department releases a year-end consolidated financial report for the federal government, followed by an audit report from the Government Accountability Office that says the numbers are so flawed as to largely render the Treasury report unreliable.
The Treasury report shows that the government's net operating cost for fiscal 2009 was about $1.3 trillion -- a $245 billion increase over 2008. In a statement accompanying the report, Treasury Secretary Timothy Geithner said the increase was due largely to rising costs for mandatory spending programs, such as unemployment insurance, Social Security, Medicaid and Medicare benefits along with economic stimulus spending. At the same time, tax revenues were down more than $400 billion due to the flagging economy. All were factors in the ballooning budget deficit, which spiked from $455 billion in 2008 to $1.4 trillion in 2009.
The only part of the government's consolidated book-keeping for which GAO was able to issue an unqualified opinion was the 2009 Statement of Social Insurance, which includes Social Security, Medicare and Railroad Retirement social insurance programs.
While the book-keeping for the Statement of Social Insurance might be reliable, it's hardly good news. The data show that the present value of projected scheduled benefits exceeds earmarked revenues for Social Security and Medicare by about $46 trillion during the next 75 years.
Without policy changes, interest payments on the country's growing debt coupled with entitlement program costs could absorb 92 cents of every dollar of federal revenue by 2019.
"Clearly, this is not sustainable," GAO reported.
"While financial management has improved significantly since the government began preparing consolidated financial statements, for the 13th year in a row now shortcomings in three areas again prevented us from expressing an opinion," said Gene L. Dodaro, acting comptroller general of the United States in a statement.
Those areas include serious financial management problems at the Defense Department, the government's inability to accurately account for and reconcile intragovernmental financial activity among agencies, and ineffective processes for creating consolidated financial statements.
Defense is the largest of four major agencies that did not receive individual clean audit opinions for the 2009 financial statement. NASA and the Homeland Security and State departments also failed to garner unqualified opinions by independent auditors.
Other major problems GAO cited include material weaknesses involving improper payments by agencies, which are estimated to be at least $98 billion, inadequate information security across government and ineffective tax collection activities.
The $98 billion estimate of improper payments in 2009 is a significant increase -- $26.2 billion -- over estimated improper payments in 2008. The increase was attributable to changes in methodologies or increased program outlays in four major areas: the Health and Human Services Department's Medicare fee-for-service program; HHS' Medicare Advantage; the Labor Department's Unemployment Insurance program; and the Transportation Department's Federal Aid Highway program.
The 2009 consolidated statement reflects the unprecedented government intervention aimed at stabilizing the economy since the start of the recession in December 2007, including investments in the Troubled Asset Relief Program, the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation, as well as mortgage-backed securities guaranteed by them.
"The ultimate cost of these actions and their impact on the federal government's fiscal condition will not be known for some time," the report said.
-Katherine McIntire Peters, GovExec.com
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The Treasury report shows that the government's net operating cost for fiscal 2009 was about $1.3 trillion -- a $245 billion increase over 2008. In a statement accompanying the report, Treasury Secretary Timothy Geithner said the increase was due largely to rising costs for mandatory spending programs, such as unemployment insurance, Social Security, Medicaid and Medicare benefits along with economic stimulus spending. At the same time, tax revenues were down more than $400 billion due to the flagging economy. All were factors in the ballooning budget deficit, which spiked from $455 billion in 2008 to $1.4 trillion in 2009.
The only part of the government's consolidated book-keeping for which GAO was able to issue an unqualified opinion was the 2009 Statement of Social Insurance, which includes Social Security, Medicare and Railroad Retirement social insurance programs.
While the book-keeping for the Statement of Social Insurance might be reliable, it's hardly good news. The data show that the present value of projected scheduled benefits exceeds earmarked revenues for Social Security and Medicare by about $46 trillion during the next 75 years.
Without policy changes, interest payments on the country's growing debt coupled with entitlement program costs could absorb 92 cents of every dollar of federal revenue by 2019.
"Clearly, this is not sustainable," GAO reported.
"While financial management has improved significantly since the government began preparing consolidated financial statements, for the 13th year in a row now shortcomings in three areas again prevented us from expressing an opinion," said Gene L. Dodaro, acting comptroller general of the United States in a statement.
Those areas include serious financial management problems at the Defense Department, the government's inability to accurately account for and reconcile intragovernmental financial activity among agencies, and ineffective processes for creating consolidated financial statements.
Defense is the largest of four major agencies that did not receive individual clean audit opinions for the 2009 financial statement. NASA and the Homeland Security and State departments also failed to garner unqualified opinions by independent auditors.
Other major problems GAO cited include material weaknesses involving improper payments by agencies, which are estimated to be at least $98 billion, inadequate information security across government and ineffective tax collection activities.
The $98 billion estimate of improper payments in 2009 is a significant increase -- $26.2 billion -- over estimated improper payments in 2008. The increase was attributable to changes in methodologies or increased program outlays in four major areas: the Health and Human Services Department's Medicare fee-for-service program; HHS' Medicare Advantage; the Labor Department's Unemployment Insurance program; and the Transportation Department's Federal Aid Highway program.
The 2009 consolidated statement reflects the unprecedented government intervention aimed at stabilizing the economy since the start of the recession in December 2007, including investments in the Troubled Asset Relief Program, the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation, as well as mortgage-backed securities guaranteed by them.
"The ultimate cost of these actions and their impact on the federal government's fiscal condition will not be known for some time," the report said.
-Katherine McIntire Peters, GovExec.com
READ MORE...
Tuesday, January 12, 2010
Today's GAO Publication
The Government Accountability Office (GAO) today released the following correspondence:
Social Security: Options to Protect Benefits for Vulnerable Groups When Addressing Program Solvency.
GAO-10-101R, December 7.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-101R
Social Security: Options to Protect Benefits for Vulnerable Groups When Addressing Program Solvency.
GAO-10-101R, December 7.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-101R
Wednesday, February 18, 2009
AGA FMSB Issues Three Comment Letters to FASAB
AGA's Financial Management Standards Board (FMSB) provided comments to the Federal Accounting Standards Advisory Board (FASAB) on its exposure drafts of two proposed statements: Estimating the Historical Cost of General Property, Plant and Equipment and The Hierarchy of Generally Accepted Accounting Principles, Including the Application of Standards Issued by the Financial Accounting Standards Board.
The FMSB also issued a comment letter on its exposure draft about Accounting for Social Insurance, Revised. In general, the FMSB commended the board for continuing its deliberations on this most important topic and for its continuing efforts to ensure that reporting for social insurance is transparent and useful. However, the FMSB remains concerned that the positions taken by some of the board members find their basis in other than established accounting and reporting principles. Read more FMSB comment letters.
The FMSB also issued a comment letter on its exposure draft about Accounting for Social Insurance, Revised. In general, the FMSB commended the board for continuing its deliberations on this most important topic and for its continuing efforts to ensure that reporting for social insurance is transparent and useful. However, the FMSB remains concerned that the positions taken by some of the board members find their basis in other than established accounting and reporting principles. Read more FMSB comment letters.
Tuesday, January 20, 2009
FASAB Seeks Input on Exposure Drafts
The Federal Accounting Standards Advisory Board (FASAB) is seeking input on several exposure drafts:
Estimating the Historical Cost of General Property, Plant, and Equipment--Amending Statements of Federal Financial Accounting Standards 6 and 23.
Comments are due Jan. 30, 2009.
The Hierarchy of Generally Accepted Accounting Principles for Federal Entities, Including the Application of Standards Issued by the Financial Accounting Standards Board.
Comments are due Feb. 2, 2009.
Social Insurance Accounting, Revised.
Comments are due by Feb. 9, 2009.
Estimating the Historical Cost of General Property, Plant, and Equipment--Amending Statements of Federal Financial Accounting Standards 6 and 23.
Comments are due Jan. 30, 2009.
The Hierarchy of Generally Accepted Accounting Principles for Federal Entities, Including the Application of Standards Issued by the Financial Accounting Standards Board.
Comments are due Feb. 2, 2009.
Social Insurance Accounting, Revised.
Comments are due by Feb. 9, 2009.
Wednesday, January 07, 2009
Obama pledges to take on entitlement spending
WASHINGTON (AP) - President-elect Barack Obama said Wednesday that reforming massive government entitlement programs _ such as Social Security and Medicare _ would be "a central part" of his effort to control federal spending.
Obama made the pledge but provided few details as he named Nancy Killefer as his administration's chief performance officer, creating a new White House position aimed at eliminating government waste and improving efficiency.
Noting that the Congressional Budget Office had just estimated he would inherit a $1.2 trillion federal deficit for fiscal 2009, Obama promised to cut unnecessary spending.
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Obama made the pledge but provided few details as he named Nancy Killefer as his administration's chief performance officer, creating a new White House position aimed at eliminating government waste and improving efficiency.
Noting that the Congressional Budget Office had just estimated he would inherit a $1.2 trillion federal deficit for fiscal 2009, Obama promised to cut unnecessary spending.
READ MORE...
Monday, November 24, 2008
New FASAB Exposure Drafts
FASAB Releases Exposure Draft on Social Insurance
The Federal Accounting Standards Advisory Board (FASAB) is seeking input on the exposure draft Social Insurance Accounting, Revised. Social Insurance comprises five programs; however, two programs, Social Security and Medicare, are of special significance because of the high rate of participation among citizens, the fiscal challenges related to the programs, and the challenges associated with incorporating estimates of future cash flows of this magnitude in financial statements.
From the outset, members have agreed on the objectives of financial reporting for social insurance programs but have had different views about how best to achieve the objectives and about the timing of the recognition of expense and liability for social insurance programs.
Chairman Tom Allen says that "this exposure draft represents a compromise. It proposes enhanced reporting but does not resolve the two strongly held views regarding when the obligating event occurs for social insurance programs and, thus, when the liability and expense definitions are met within those programs." Comments on the exposure draft are due by Feb. 9, 2009.
FASAB Releases ED on Estimating the Historical Cost of General Property, Plant and Equipment
The FASAB is seeking input on an exposure draft, Estimating the Historical Cost of General Property, Plant, and Equipment--Amending Statements of Federal Financial Accounting Standards 6 and 23.This Statement proposes to clarify that reasonable estimates of original transaction data historical cost may be used to value general property, plant, and equipment. Comments on the exposure draft are due by Jan. 30, 2009.
The Federal Accounting Standards Advisory Board (FASAB) is seeking input on the exposure draft Social Insurance Accounting, Revised. Social Insurance comprises five programs; however, two programs, Social Security and Medicare, are of special significance because of the high rate of participation among citizens, the fiscal challenges related to the programs, and the challenges associated with incorporating estimates of future cash flows of this magnitude in financial statements.
From the outset, members have agreed on the objectives of financial reporting for social insurance programs but have had different views about how best to achieve the objectives and about the timing of the recognition of expense and liability for social insurance programs.
Chairman Tom Allen says that "this exposure draft represents a compromise. It proposes enhanced reporting but does not resolve the two strongly held views regarding when the obligating event occurs for social insurance programs and, thus, when the liability and expense definitions are met within those programs." Comments on the exposure draft are due by Feb. 9, 2009.
FASAB Releases ED on Estimating the Historical Cost of General Property, Plant and Equipment
The FASAB is seeking input on an exposure draft, Estimating the Historical Cost of General Property, Plant, and Equipment--Amending Statements of Federal Financial Accounting Standards 6 and 23.This Statement proposes to clarify that reasonable estimates of original transaction data historical cost may be used to value general property, plant, and equipment. Comments on the exposure draft are due by Jan. 30, 2009.
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