Peter Orszag, speaking at a conference on budget issues held by the Committee for a Responsible Federal Budget, gets the real long-term fiscal problem (emph. mine). ...the floor was given to CBO director Peter Orszag, who made the following three points. 1) The long-term story here is not aging or entitlements, but health care costs that are spiraling out of control. "We do a disservice," he continued, "by uniting the health care issue with the aging issue," which represents a much less serious fiscal danger. Medicare, not Social Security, is what is driving up the costs of entitlements, and it is increasing so dramatically because of overall increases in the cost of health care, not because of our aging population. 2) Social Security is often spoken of as the easiest of the three major entitlement programs to fix, but this gets it backwards. When dealing with health care, there is an opportunity to eliminate waste and inefficiency without affecting health outcomes. On the other hand, Social Security is a cash-transfer program, so the only way to cut costs is to reduce benefits. 3) There is no crisis unique to Medicaid and Medicare. The problem is with systemic inefficiencies in the health care system, and so it follows that the solution is not to cut benefits, but to figure out a way to bring down costs. Nobody at the conference disagreed with Orszag's math. Seriously- everyone agrees that health care prices and waste are the cause. So there's a new consensus of what's driving the long-term fiscal imbalance- health care, irrespective of demographics, and not Social Security. There was plenty of disagreement on a) whether this health care imbalance was as important as other problems -such as the rather abstract "entitlement" or "budget" problem that seems to be derived from a fundamental aversion to government spending- and b) what policies would address the health care imbalance, and c) the political viability of the proposed solutions. It's really a look behind the curtain, in terms of the fiscal policy establishment- check it out if you have the chance.