Prior Commitments

Abstract

The US Government's total liabilities were $22.8 trillion in 2016. The liabilities include the familiar debt held by the public of $14.2 trillion. They also include the accrued pension and other retirement benefits payable to federal civilian and military employees of $7.2 trillion and $1.3 trillion in other liabilities. Altogether these official liabilities are 23% larger than GDP. But are the official liabilities the end of the story? Because retirees don't have a legal claim to their Social Security and Medicare, their accrued benefits are not included in the official liability tally. But if these accrued benefits--limited to just those payable to current retirees--were treated as liabilities they would add another $19.8 trillion to federal liabilities. This issue of PERCspectives on Policy explores the rationales for treating accrued Social Security and Medicare benefits payable to current retirees as comparable to the other official federal liabilities.