CRS Issue Statement on the Aging of Society

Janemarie Mulvey, Coordinator
Specialist in Aging Policy

Currently, transfer payments and services to the elderly comprise one-third of the federal budget. As the first wave of the baby boom generation (born between 1946-1964) begins to retire, a combination of an aging population and longer life expectancies will have important implications across many different policy areas for Congress. In addition to their sheer size (approximately 80 million), longer life expectancies means their retirement income from both public and private sources will have to last over a longer period of time. This is also expected to increase health care costs and the likelihood of needing often expensive longterm care (LTC) services. In addition, declining fertility rates will result in relatively fewer workers available to support a growing number of retirees. 

For public programs such as Social Security, Medicare, and Medicaid, benefits will most likely be paid over a longer period of time to a relatively larger cohort of beneficiaries, resulting in spending significantly above current levels. In addition, public programs targeted toward older Americans largely rely on payroll taxes paid by current workers. As the ratio of workers to retirees declines, growth in tax revenues to fund these programs is also expected to slow. Congress may consider policies to address expected shortfalls in these programs.


Date of Report: January 13, 2010
Number of Pages: 5
Order Number: IS40279
Price: $7.95

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