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Promises? You Mean $104 Trillion in Unfunded Promises?

Washington, Mar 26 -

President Obama finished up his speech to students at a rally in Iowa yesterday with an unfortunately laughable line.



“And it's because of you that we are going to keep on going to make sure that we fulfill every promise to every child in this country for a brighter future.” (President’s Remarks, 3/25/10)



Every promise, huh? Politicians in Washington have made tons of promises to future generations, but unfortunately for “every child in this country,” we don’t have that kind of cash. According to Richard Fisher, President of the Federal Reserve Bank of Dallas, Social Security and Medicare currently have unfunded liabilities of $104 trillion. No, that is not a typo.



“But they largely ignore the severity of the broader problem: accumulated entitlement debt over the infinite horizon. According to our calculations at the Dallas Fed, that unfunded debt of Social Security and Medicare combined has now reached $104 trillion—trillion with a 'T'—in discounted present value.” (Fisher Remarks, 2/10/10)



And, in case the President did not notice, Social Security is already paying out more in benefits than it is taking in. Maybe it would have been smart to make sure we’re keeping promises already made before making new ones.