Wealthy people should have to wait a few years longer than the poor to start collecting their Medicare and Social Security benefits, argues bioethicist Ezekiel Emanuel in the New York Times today.
Emanuel, who is the older brother of former White House Chief of Staff and current Chicago Mayor Rahm Emanuel, wades into what is commonly seen as the untouchable, third rail of politics: entitlement reform. If current tax breaks and spending continue at today's levels, America's tax revenue will only be able to pay for Medicare, Medicaid, Social Security and the interest on the national debt by 2025. "The rest — defense, medical research, highways, education, energy — will have to be financed by deficits," writes Emanuel.
Instead of uniformly cutting benefits for America's elderly, Emanuel argues that the nation should institute a graduated eligibility age for both Social Security and Medicaid that is based on lifetime personal earnings:
People in the bottom half of the lifetime earnings distribution would become eligible for normal retirement benefits at age 65 for Medicare and 66 for Social Security, just as they are today. But people in the next quarter of the lifetime earnings distribution would become eligible for the respective programs at 67 and 68, and those in the top quarter would become eligible at 70 and 71. All eligibility ages would increase over time, as they are scheduled to now.
Emanuel says this plan makes sense because rich people live longer than the poor do, and that gap is growing wider. Men in the top half of the income distribution live an average of five years longer than those in the bottom half.
Neither Mitt Romney nor President Barack Obama has openly embraced graduated eligibility ages in their entitlement proposals.
Romney hopes to gradually decrease Social Security benefits for retirees who are richer as a way to ease what he calls America's "debt and spending inferno." For Medicaid, Romney wants seniors to be able to choose a private plan, reasoning that the competition between the government and private plans could lower prices. He also favors slowly increasing the eligibility age for everyone, based on increased life expectancy.
While on the trail in 2008, Obama vowed to tackle entitlement reform in his first term, but has so far avoided the subject. He reportedly considered raising the Medicaid eligibility age to 67 and slowing the growth of Social Security payments while in debt ceiling talks with Republicans, but then backed off those proposals. The Obama administration says that health care reform, which instituted some cost-saving measures, will slow Medicaid spending by about $500 billion over 10 years.
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