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The Anatomy of Social Security and Medicare

Social Security in the United States is the largest government expenditure program in the world, with expenditures of $523 billion in 2005. That figure includes only the cash retirement benefits paid. Social Security's companion policy that covers the elderly's medical expenses, Medicare, had exp enditures of another $299 billion. Taken together, the federally financed retirement benefits amounted to $822 billion.

Despite its vast size and its effects on almost all Americans each year of their lives, the Social Security system is probably the most poorly understood government policy of all. The jargon alone is incomprehensible: we hear of unfunded liabilities, infinite and seventy-five-year ...

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