You've pretty well summarized the problem. Didn't you and I have a similar discussion before? It's a combination of shifting demographics leading to an imbalance of takers to payers and positive feedback that makes the imbalance worsen as the payers die or move away to avoid higher taxes and/or possibly what they see as deteriorating social conditions. Exacerbating factors might be: a. a disconnect between election politics and fiscal management exigences; b. faulty ROI assumptions that don't get timely adjusted because of politics; c. The U.S. medical Cartel that continues to increase its fraction of U.S. G.D.P.. This negatively affects most locales in the U.S. and plays a major, but often veiled, role in increasing benefit costs for public employees as well as being the number one cause of personal bankruptcies. The Cartel, which includes the insurance industry, encompasses many practices that, if not federally protected via regulatory capture, would come under the heading of corruption and graft; d. Regulatory capture, in general, that raises costs and hampers competition without significant, compensatory benefit; e. government corruption and graft (likely minor compared to other issues, but always major in the minds of the public and those posting on internet fora).
What to do about it? The neo-libertarian, I suppose, buys guns, ammunition and can goods, and puts up fences, or else relocates to Idaho or Wyoming and waits for the government to show up in tanks. Sadly, there are to few true Libertarians, such as myself, to be able to affect much in the way of political solutions; yet we know what they are! Everything we do and vote for is a compromise with an eye to not making matters worse, and hopefully somewhat better both with respect to increasing personal freedom and government efficiency. We aren't making much progress, and we have suffered huge setbacks since 2001.
