benefiting from chief dust cheap and disposable goods is a red herring because they have to be purchased and repurchased. clothing that is badly made does not last. the people with the least ability to pay are being cut up the worst. >> the fabric act traduced by kirsten gillibrand in addition to they fashion act would create a near-perfect bill to go through congress and be placed on the desk of president biden. we would vote for that. there are garment workers suffering and our planet is dying because of fast fashion and we want to do some that about it. >> for the sake of the world. >> to watch this and all winning entries, visit our website at studentcam.org. ♪

>> since 1979, in partnership with the caleb -- cable industry, c-span has provided complete coverage of the halls of congress, from house and senate floors to congressional hearings and committee meetings. c-span gives you a front row seat to how issues are debated and decided with no commentary, no interruptions and completely unfiltered. c-span your unfiltered view of , government. >> we return to the topics of social security and medicare. back with us is charles of the mercatus center at the george mason university. university, the social security and medicaid trust fund. that yearly forecast came out late friday afternoon about the long-term health of social security and medicare.

what did that report find? guest: that report found would all have found for several years now. unfortunately, these reports tell of that we are going to have to make some pretty substantial changes to align the benefits with their project -- rejected tax revenue if we want to preserve and retain the type of social security and medicare programs that we now have. host: how long are we expected to have social security and medicare fully funded? guest: that is a great question. i'd like to answer that in a very bifurcated way. you also tsipras reporting focusing on the dates of depletion of the social security trust funds and the medicare hospital insurance trust fund. and those dates respectively are 2033 for the old-age and survivors insurance trust fund with social security, what

people think of as retirement that. 2034 for the combined trust fund. 2041 for the medicare hospital insurance trust fund. but i do encourage people to look past those dates a little bit for a number of reasons. one, especially in medicare's case, the insolvency date doesn't tell you that much. medicare only has one trust fund, a hospital insurance trust fund that even has an insolvency date and it is less than half of medicare. if you just talk about the depletion date and medicare, you miss over half of the program. and in social security, the date of depletion it doesn't really tell you when you have to act. you have to act a lot sooner than that. the reason is that by the time the trust funds are actually running out of resources, it is far, far too late to preserve the operation of social security

as it currently is. if you were to wait to start making changes, you would not be able to preserve program solvency, even if you completely denied all new benefits. just didn't pay benefit to anyone who is newly coming onto the role of 2023. at that point, clearly the game is long over. you can't retain it social security functioning in the way that it has historically operated, and so the window of opportunity to deal with social security is really in the process of closing up. host: this yearly report, the headline full was going around those insolvency dates, those depletion dates. this is one from the washington post focusing on social security's cynically. that social maturity one now expected to hit that date a year earlier than what was reported last year for medicare.

it is projected to hit that day three years later. what determines these dates moving back and forth and why would one happen later and the other happened earlier? guest: good question. let me answer the last part of it first. someone might wonder, why is social security depletion date moving in one direction and why is medicare hospital insurance moving the other direction? i think the short answer is that the factors that affect both programs, things like inflation, real wage growth, the general state of the economy, those things basically got worse and that causes social security to get worse. medicare hospital insurance has another factor, which is the growth of health-care costs and health care spending.

that was a little bit less than projected in last year's report. medicare hospital insurance is projected to last a little bit longer. host: we had them on the program in the past. if you want to join the conversation as we talk about medicare and social security, you can do so on the phone lines as usual. republicans, (202) 748-8001. democrats, (202) 748-8000. independents, (202) 748-8002. and a special line specifically for medicare and social security recipients, (202) 748-8003. if that confuses you, we will put the numbers on the screen for you. along with working at george mason university, a former public trustee of the social security and medicare trust funds from 2010-2015. explain what the trustees do. guest: the public trustees,

which i was one, are basically there to represent the public and oversee and act as an independent, bipartisan check on the financial projections for social security and medicare. i'm very pleased to have the opportunity to talk about that because it really cuts to the heart of why we have trustee reports and why they are important. the fact is that social security and medicare are not price for federal programs. they are not considered to be welfare programs. if you look at most other programs in the federal government, we don't have this report process. we don't have separate trust funds. we don't have a separate payroll tax. we don't have all these things that social security and medicare have. and the reason is that we are basically just collecting taxes from people on the basis of their ability to pay. and we are paying benefits to people on the basis of needs. and so you have different sets

of people financing the programs and collecting the programs, and so you often have the sort of political collisions, these collisions of interest between people financing the programs and people drawing benefits from them that lead to very frequent revisions of benefit levels, eligibility rules, different requirements, so forth. things that social security and medicare generally escape. why do social security and medicare not tend to have those very frequent, recurring assessments of what people are getting out of the program? the reason for that is that they are, by contrast, contributory insurance programs. we all pay into these programs when we are wage earners. we contribute payroll taxes. we withdraw benefits from these programs, and our benefits and social security are linked to the amount that we paid in. and so because of that, participants can say you can't

just come in and cut our benefits. our benefits reflect the resources that we paid into the trust funds and we are not pulling out more collectively than we contributed, then we earned. there is a price for that very special political status, which is that we have to make sure we keep these programs in alignment. we have to make sure the benefits are promising and don't exceed woodworkers contributions can actually fund. and that is the problem we have right now, the way these programs are automatically indexed to grow, they are promising payments far in excess of what they can finance, and we need to bring those back into alignment and the trustees report basically tells us what we need to do order to be able to continue that type of set up it is a very important set of annual reports that the public trustee is, they job is to represent the public and voucher the integrity and objectivity of the process.

host: what were the trustees saying back in 2010 when you first became a public trustee about the insolvency dates of these new programs, but also how to fix these programs? were they saying the same things? guest: very much so. it is discouraging in a way to get these warnings have been coming for decades. by the early 90's, we knew that both programs were very badly out of financial balance. there has been some adjustments to improve medicare finances over the years, some in the late 90's, some more in 2010. social security has not received much in the way of remedial action, and for years, the trustees have been saying with increasing urgency that you've got to deal with this. don't wait until 2023. unfortunately, we have waited until 2023 and also a longer, so we've made the problem much more

difficult to solve than it would have been if we had acted back then. host: prayer visual learners, some of the note that this latest report. it came out late on a friday afternoon last week and we are digging into it this morning. the social security trustees report found that the retirement trust fund can pay 100% of the benefits until 2023. after 2023, reserves will become depleted and continuing income can be 7% of benefits. when it comes to the medicare trustees report, medicare will be able to pay 100% of benefits until 2031. that is three years later than last year. after 2031, 10 ewing program income will be sufficient to pay 89%. those were sort of the topline numbers from that report. we are talking with you that it, taking your questions about the

future of health, social security and medicare. plenty of callers for you as usual on this topic. out of california, good morning. caller: good morning to you. thank you for c-span. i am a chronic pain patient, so i keenly rely on those payments. i just have one question. the military seems to have so much money, they don't even tell us where it is going. has anybody thought of, you know, forcing them into the light a little bit? it wouldn't matter to me how they did it. it just seems to be so much money going there. host: as a way to fully fund these programs for longer? caller: yeah, or at least a part of the solution.

i don't know that it could be the full solution, but just maybe a good chunk of it. because they spend so much money and they don't even tell us how much or what for. and if there were more transparency in that, maybe we could agree that they don't need whatever it is. host: solutions, that as one proposed solution. your thoughts? guest: i would make a couple of points about that. we certainly could go to a different kind of system in both social security and medicare. we can say let's not worry anymore about making the programs work, it's just ray that the general funds, give them whatever revenues they need from general fund revenues from income tax revenues and stop with all this business about keeping programs in effect, financing them. we could do that. but i think we need to be aware of the consequences of doing

that. what has generally happen with programs that are financed from the general fund is you have this sort of annual, recurring realization of benefit levels and eligibility rules that happens inevitably because you had a lot of people paying income taxes that other people aren't paying, and a lot of people drawing benefits that they didn't pay for. so you have these frequent collisions between taxpayers and beneficiaries that cause the contracting programs to be continually rewritten. social security and medicare, we haven't had that happen to the same degree, and the reason for that is that fdr deliberately designed social security to abate that process. he wanted workers to be able to say we pay for our own benefits and the benefits request will be paid. he thought that would give them

additional protection from some cuts. i think his calculation has proved to be correct in that regard. much more secure and reliable than other federal benefits over the years. we could dispense with that. we could say forget it, we will start paying benefits to people irrespective of whether the payroll tax contributions were enough to finance them we could go that way. but i would issue a warning against doing that because we will lose, i think, something pretty important about social security. this idea that workers pay for their benefits and therefore, should be more secure against them. host: so what are your thoughts on this proposed solution? this is part of a statement of president biden released when he leed his budget pposal back at the end of last month. myudget proposes an increase of the medicare tax rate on earned and unearned income above

$400,000 to 5% from 3.8%. he went on to say as i propose in the past,y dget will ensure that the taxes for medicare, th modest increase in mice contributions will be the highest incomes and help keep the medicare program strong for decades to come. guest: i was fairly critical in president biden's proposal here. not so much for attacks increased part. different people could have different opinions about whether that tax increase is desirable or not, but that is a real tax increase that would ring in real revenue and by doing that, that would create some extension in medicare hospital insurance probably. the basis of my concern with the president's proposal was really the other elements of it, taking credit for a much, much longer extension of insolvency,

decades. basically getting credit to the medicare hospital insurance trust fund for savings that were being assumed elsewhere or for things the government was already collecting. basically, he proposed that savings from the prescription drug benefits that they projected based on enhanced negotiating powers of the federal government, transferring those to the medicare hospital with insurance trust funds, because medicare investment tax which doesn't go for the hospital insurance, putting that in the medicare hospital insurance trust fund. those are basically -- that is not you revenue. those are things someone is already doing. by giving medicare hospital insurance permission to spend more money, you are not actually fixing anything from a fiscal perspective, you are just saying your things the government is already doing, and we are going

to give medicare permission to spend more money based on that. i think that is problematic because that basically gives up on the idea that hospital insurance should be kept solid on its own. if you are able to say look, we spent less money over in the program, so now it's give medicare hospital insurance permission to spend that money, there's no reason you can't do that everywhere. we are spending less on program next y, now hospital insurance can spend more money. that deals a fatal blow to the idea of a solid hospital insurance program. it basically says hospital insurance has permission to spend money that it didn't generate. i think that is very problematic. that is not a criticism of the president's proposal with respect of the tax increases, but i do have concerns about playing with the accounting in this way to create an apparent improvement in medicare's finances without actually accomplishing anything.

host: milwaukee, wisconsin, republican. good morning. caller: good morning, i have two questions, i will start with the longer one and see if you have time to the second one. it is in regard to social security solvency. my understanding is that in order to make it solvent, we would have to do a number of different things like increase the amount of income that is subject to social security taxes, but also increase the retirement age and however, i would be delighted if the biden administration and bernie sanders, i heard this about a month ago -- i wanted to see if you think the numbers are jive. for the upper income folks, how much of their income is subject to social security taxes being taken out as they are making income? i think it is only the first $185,000 now or whatever, and i think bernie sanders said if we start doing 250,000 as well, it

would be solvent for like 70 years. and even if we only did 400,000, that it would still make it solvent for another 30. host: you're talking about raising the cap, as it is known. guest: there is a number of great things in the question that i just want to emphasize and reiterate. let me start with the second part of the question about specifically the mechanism of increasing the amount of earnings subject to social security tax. social security solvency as our more popular, per se, but that is one that surveys relatively well. a lot of people favor that. the component of a social security solution, in large part because the bu