The Fiscal Problem of the 21st Century

Charles Jones, Visiting Scholar at the Federal Reserve Bank of San Francisco and Associate Professor at UC Berkeley, writes about the fiscal challenges ahead.

The fiscal problem of the 21st century, then, is this: Under current policies, the fraction of resources society devotes to health care appears likely to rise substantially over the next 50 years. Reasonable projections suggest that spending on Medicare and Medicaid as a percentage of GDP may well rise from 3.4% in 2000 to nearly 15% by 2075.