Treasury Secretary Timothy Geithner on Thursday described an annual report issued by Medicare trustees on the program's long-term prospects as "very encouraging."
One can envision Mr. Geithner at the helm of the Titanic moments after it rammed into an iceberg in the north Atlantic proclaiming that it was "very encouraging" the liner hadn't suffered more structural damage.
The report, in fact, is a crock -- as even the program's chief actuary pointed out.
Using "static analysis," the trustees conclude that more than $500 billion in projected Medicare savings under ObamaCare will extend the solvency of the program by 12 years to 2029.
But the $500 billion is a figure snatched out of thin air by congressional Democrats and the White House. Even if we buy the nutty notion that creating a whole new health care entitlement for every American will actually save money, much of the projected savings is based on cuts to providers that Congress will never actually let happen.
Richard Foster, chief actuary for the Centers for Medicare and Medicaid Services, admits that, "The financial projections shown in this report for Medicare do not represent a reasonable expectation for actual program operation."
And what about the recession? Medicare and Social Security are both going to pay out more than they take in this year thanks to the economic downturn. Even if we experience a sudden turnaround, "By 2015," USA Today noted last week, "every year will be written in red ink."
Remember, when Medicare was created in 1965, a House committee estimated it would cost $12 billion a year by 1990. In reality that figure was $107 billion.
The prediction that Medicare will realize "savings" thanks to the new health care legislation should be treated just as seriously. In no way does this dubious report undermine the urgent need to reform our budget-eating entitlement progams.