$59 Trillion

If accounting and reporting standards applied to the private sector were applied to Uncle Sam, that would be the amount of liabilities that would have to be recorded on the books of the federal government, according to USA Today.

Though it ignores the government’s assets, I find the liabilities number credible.

Most of the liabilities are in Social Security and Medicare, the two programs that Congresses controlled by both parties and every president until the current occupant of the White House have for the most part resisted applying any kind of meaningful reforms to.

Ronald Reagan occasionally referred to the idea of making Social Security voluntary, but in the name of pursuing what he felt were larger goals (winning the Cold War, and reforming the then-punitive federal income tax structure, and turning the economy around), he pledged to leave the fundamental structure of Social Security in place.

A mid-1980s Social Security commission headed by Alan Greenspan considered private accounts, but instead opted for tweaks to the retirement age and tax increases that kicked the can down the road instead of fundamentally reforming the system.

A 1995 congressional attempt to reform Medicare that could have fundamentally changed the program for the better led to the president shutting the government down until Congress backed off.

The Clinton Administration mostly talked about reforming Social Security during its second term, and as I recall never had a bill introduced supporting a reform framework it favored. It resisted private accounts, instead favoring direct government investment in the stock market — a move that inevitably would have led to the government, at best, making political statements (don’t invest in tobacco, etc.), or at worst, picking favored companies.

President Bush has made fitful attempts to get a relatively puny version of private accounts onto the national agenda, and the response from opponents has been “there is no crisis.”

Really?

As I’ve said before (here and here), supporters of leaving the two programs alone, no matter what, have a distinct advantage. Their position improves with each additional day of dithering, because the larger the unfunded liability gets, the more difficult fixing the problem becomes, until it gets so overwhelming that our problems resemble the virtually intractable ones facing France and Germany. It’s clear that believers in the status quo would consider that a good thing.