How to save Social Security, Medicare, get rid of the deficit, reduce the debt, and save the state’s budgets in one fell swoop.
First extend Medicare to all citizens and incorporate Medicaid into Medicare, taking it off the backs of the states. Basically, go to single payer health care.
Then take Social Security and Medicare off budget. Congress doesn’t even have a chance at the monies in these trust funds.
Enable a 20% payroll tax that is directed to SS and Medicare. Employer matching as well. For people receiving income without a paycheck, or over and above a paycheck, they would pay a flat 20% tax to the combined trust funds.
The US income is ~$14T. Medical expenses run ~$2T. So that 20% payroll/income tax should cover the all medical expenses and the remainder goes into Social Security. The citizen is receiving a retirement fund safety net and basic health care for life.
This takes States and Employers off the hook for providing health care services to their citizens and employees, removing a big drag on their budgets.
For the remainder, Congress passes a budget for the year and must pay for that budget with revenue. It must authorize collecting enough revenue to pay for that budget, keeping SS and Medicare off the table. And unless there is a declared economic emergency, the budget will include paying 5% of the principal of the outstanding national debt.
The base of the taxpayers are already paying 20% of their income to the trust funds, so I suggest that for citizens making more than the median household income or $75K or some amount that won’t crush the lower-income household, that they pay enough income taxes to cover the budget. Congress can determine if it a flat tax or a sliding scale tax. Either way deficit spending ends and the debt starts to come down.
Or we can leave the national debt part out of the previous equation and say that all corporate taxes collected go to pay down the debt, but then it will never go away.
(I just did a quick check and if we pay off the debt at 5% per year, in 60 years it will be @ 5% of the of the current debt. )