Consider an average-wage, two-earner couple together earning $89,000 a year. Upon retiring in 2011, they would have paid $114,000 in Medicare payroll taxes during their careers.
But they can expect to receive medical services – from prescriptions to hospital care – worth $355,000, or about three times what they put in.
The estimates by economists Eugene Steuerle and Stephanie Rennane of the Urban Institute think tank illustrate the huge disconnect between widely-held perceptions and the numbers behind Medicare’s shaky financing. Although Americans are worried about Medicare’s long-term solvency, few realize the size of the gap.
“The fact that you put money into the system doesn’t mean it’s there waiting for you to collect,” said Steuerle.
Umm, I believe it’s called ‘spreading the risk;’ Otherwise called ‘insurance.’
Exactly, Cennydd. I don’t understand why people would find this surprising, especially since Medicare serves a clientele that will utilize services more.
I have a genuine question (writing from the UK I am unfamiliar with the details). The article mentions what an employee would pay in to the scheme. Do employers not make a parallel contribution?
3, ultimately its all out of the same pot of money.
The real source of the problem is that people just haven’t had enough children, so there aren’t enough workers to be paying in. If all the baby boomers had had as many children as their parents did, there would be no issue here.
Susan Peterson
This is a health insurance plan; nothing else, and it’s meant to cover every working American. It’s not perfect, by any means, but if it were not for this plan, millions of our citizens who have worked hard afor all of their adult lives would have no coverage at all. I too am concerned about its future, but at the same time, aren’t we supposed to be concerned about the health care of those who, for various reasons, can’t afford the high cost of prescription drugs or hospitalization once they retire? Aren’t we overly concerned about ‘What’s in it for me?’
I think we have enough wisdom to ensure that senior citizens don’t have to go without affordable medical care in this country, and yes, some are always going to complain about it. It isn’t perfect, and it has its flaws, but what else can we do? Rationing of healthcare? NO! Denial? NO!
Ya know, it is never mentioned that its almost impossible to not get on Medicare.. Quite a hassle actually.. ALSO, it is hardly ever mentioned that Medicare premiums are deducted from ones incoming Social Security payment. The premium is probably not high enough, but it does take about 10%. Also, those who work also pay into SS,and Medicare,. So, its not exactly a freeloading program.. Lots of folk act like its all outgo, and while the income is probably not enough, at least there is some, it sure is NOT free
Grandmother
Many people in my generation (20 somethings) have given up on the reliability of medicare being there when we get to that age. I for one, and I know others who agree, would prefer to have the program grandfathered out slowly and simply be expected to save now. I know it is a crazy concept that we actually take responsibility for something like that but the future looks grimmer and grimmer for that system…
The problem is that all the evidence shows that people are saving less and less. So the generation currently retiring has saved much less than their parents and the generation coming after them still less.
The state certainly has no interest in protecting people from the consequences of their bad decisions when it comes to having to live in a small run down apartment and eating at McDonalds for the rest of their life after they retire, but we would have social chaos if we had millions of older Americans dying because they had no health care. We simply cannot turn 80 year olds out of the emergency room to die in the streets because they don’t have insurance. They have to be treated. This can be done chaotically and randomly or in an organized manner. Medicare is an organized manner.
And it is much preferable to the alternative……much as some think otherwise. We are, after all, ‘our brother’s keeper,’ are we not?
InChristAlone,
You couldn’t “save” enough to cover your own medical expenses when you’re elderly (or, as in my case, disabled at middle age). Prescription costs are big and unrelenting, as well. Private insurance companies wouldn’t take you on as an elderly or disabled person because they know they’d lose money.
In this country, everyone save the billionaires is one major illness away from poverty. As I found out, the nest egg doesn’t last very long when you’re not working and have to pay medical bills. Even copays and deductibles add up and expend resources quickly.
It might sound noble and independent to insist that everyone should simply save and pay their own way but it’s a David against Goliath situation. In this case, David doesn’t win. Folks who pay cash for their medical care are often charged far more than the rates the insurance companies negotiated for their members. In my case, I had to pay $200 in cash to see my rheumatologist when I didn’t have insurance; when I did have insurance, he received about $100 from my copay and the amount that the company paid him. He gets about that from Medicare now.
For hospital services, it’s even worse. If you look at what the actual charges are before they apply the insurance discount/rate, it’s mind-boggling but that’s what folks without insurance must pay. Thank God for religious-affiliated hospitals that do a lot of grant-writing to provide financial assistance but they can’t cover everyone.
And that’s where Medicare comes in. I know of a woman…..married and with four children……who works for an insurance company, and is facing major surgery, and who is going to have to pay an outrageous amount in hospital bills and co-pay fees. She and her husband, who is self-employed, are stretched to the financial breaking point, and even though she’s enrolled in her employer’s healthcare plan, they are faced with filing for bankruptcy because of those astronomical bills. She’s not old enough to be covered by Medicare, and even if she were, it still wouldn’t be enough.
I am a service-connected 100% disabled veteran……a full left leg amputee, and if it weren’t for the fact that I am enrolled in the VA Medical Care System and am covered by Tricare for Life and Medicare eligible, my wife and I would’ve had to declare bankruptcy years ago. Is Medicare perfect? No, certainly not, but I’d hate to think of what seniors in this country would do without it! So, grouse about it all you want to, but this is what we have, and it’s better than what we had before it took effect.
If the same 114,000 had been safely invested over the course of this working couple’s career instead of consumed by the government, would it at the end exceed 355,000? I think so. That’s how private insurance works, the insurors collect premiums as cash flow over a course of years and make the money grow larger than what they pay out in benefits.
The politicians are literally at the edge of bankrupting america but continue to successfully sell themselves to that portion of us on the political left as the solution to our problems. I can only shake my head and wonder.
It isn’t grousing to recognize that a system is failing. The plain fact is that the system, according to the article, “is totally unsustainable.” Those that are benefiting from the system today, according to the article are, “making out like bandits, shoving all those costs to future generations.” That is intergenerational theft.
People can and do rationalize this as “shared risk”, but it is neither “shared” nor a “risk”. The facts belie that rosy assertion. First, it isn’t “shared” because the money is coercively taken from they younger generations. It isn’t voluntary and there is not opting out. It isn’t “sharing” when a bully takes what belongs to another. Second, the younger generation will pay into this system their entire lives (or for as long as it keeps going), yet they will receive nothing when it is their turn to get benefits, because all of the money that they are putting into the system is being spent now for the benefit of others and there will not be enough contributors when they retire to even provide them with the money that they put in. So, the younger generations will not “share” in any benefit, they will simply lose. There is no equity, it is simply theft. Finally, it isn’t “risk” to the younger generation because it is a mathematical certainty that at the current rate, the system will be bankrupt by the time they are elligible to receive benefits. There will be no benefits for them. It is a myth that those receiving benefits tell themselves to justify the intergenerational theft that is occuring.
The narcissistic boomer generation (with individual exceptions, of course) stole the nuclear family from their children through their “sexual revolution” and “feminist emancipation”, leaving a wreckage of broken families and latch-key kids. They have stolen the retirement money from their children through Social Security. And now, they have stolen the money their children have paid in to Medicare, because they are taking not only what they themselves put into the system, but what their children are putting into the system as well; leaving nothing for those that come behind them. They have been like locust.
A good person leaves an inheritance for their children’s children,
but a sinner’s wealth is stored up for the righteous. Proverbs 13:22
I am striving to leave something for my children and their children, but you boomers are certainly making it hard. You never saved for your own needs and now you are stealing from me, through these coercive government programs, to provide for yourselves. But you are not just stealing from me, you are stealing from my children. We are Trillions of dollars in debt and we add another Trillion dollars every year to the debt. You are enslaving me and my children and my children’s children. There is no money. Everything is borrowed.
The rich rule over the poor,
and the borrower is slave to the lender. Proverbs 22:7
Ugh! Typos!
“…coercively taken from [b]the[/b] younger generations.”
RE: “Many people in my generation (20 somethings) have given up on the reliability of medicare being there when we get to that age. I for one, and I know others who agree, would prefer to have the program grandfathered out slowly and simply be expected to save now.”
Oh — believe me, ICA — the 30 somethings and the 40 somethings too. We all recognize that we won’t get Medicare — as horrible a system as it is — and anyone with any sense in those age brackets is preparing as best they can.
Of course, the question of honor is — what to do with those who have already paid into this ponzi scheme honorably and from whom the State has stolen their money over the years? I can think of nothing honorable to do other than pay their SS and Medicare as the State swore that it would do, and to our own devastation.
My solution — go ahead and allow those under 55 to keep their money without the State confiscating it for pretend-medical care and pretend-retirement. They can funnel that money into the sort of investments that actually mean something. And pay through the nose for all those post-50 who are already “invested” [sic] in the State’s system.
It’ll be a rough rough rough rough several decades. It’ll mean cutting to the bone all other social programs as well as the other programs that are non-Constitutional. We could rid ourselves of the Federal Education [sic] program and a bunch of other things, in order to pay the State’s obligations to those from whom it confiscated so much money that could have otherwise been usefully spent or invested.
Ultimately healthcare will be the two tier system, rather than the multi-tier flexible system that the market would have allowed had not the State intervened back in the 60s and given us the glorious mess we all have today. One portion of the population will be in an increasingly horrific State-managed program with the physicians of the sort who are interested in that sort of thing. The other will be with the all-cash, no Medicare/Medicaid/insurance program that physicians are increasingly turning to as they opt out of the system. Our local newspaper just had a great article about a couple of local physicians who are doing great business — seeing 1/3 to 1/4 of their former patient load, and opting out of all the bureaucracy of the State and insurance. They love it. And I’ll wager their patients do too.
But the only moral thing that I can see to do, regarding those older people who have paid trustingly into the State ponzi scheme their own hard-earned wages.
Hopefully those of us who are younger have learned the lesson well.
Was not Medicare sold as part of its 1960s passage the notion that all your health needs would be covered by it in old age? Something for the devotees of Obamacare and its promises to contemplate…
I think that it is honorable to pay back what people put into the system (that they designed, approved, and implemented) that is failing. What is not honorable, but rather the height of selfishness, is to continue to take from the younger generation and enslave through debt their children’s children. By all means, people currently receiving benefits should receive the balance of their money back. Those currently not receiving benefits should no longer be required to pay into the failed system. That is fair. The younger folks will still lose out on what they have already put in, but at least the theft will stop. The older folks will get every penny (and for most, more) that they ever put into the system. What could be more fair…even generous, to those that implemented the system for their own benefit at the expense of the younger generation? After all, no one is making them pay back money that they received but never put in in the first place.
Let’s be honest here. The generation that is receiving the benefits are the ones that created this failed system. They voted for the politicians (and kept them in power ) that perpetuated the failed system. They didn’t seem overly concerned about the future solvency of the system they created and they didn’t bother to save on their own, despite the demographics and the obvious coming insolvency. So they should not feign surprise that the system is bankrupt.
One way or another, the system will bankrupt. The choice is, do we let it go bankrupt now so that those that created the failed system no longer get to take money out of it that they never put into it, or do we continue the intergenerational theft and let the creators/sustainers of the system steal every last cent that can be stolen before the system implodes?
I vote for paying them back their money and closing this chapter of the Great Society. I am not even asking for the money back that I have paid into the system. They can keep it. All I ask is that they quit mortgaging my children’s and grandchildren’s future to pay for their own lack of financial self discipline. For those of you that do not fall into that category, ignore what I have written. It isn’t directed to you. (And thank you for trying to stop this train wreck before it happened. I know you did your best, but your peers really blew it for all of us. Those that believed in Johnson’s Great Society and year after year, election after election put us into this horrible mess are the ones responsible, and they should stop being rewarded with other people’s money.)
The assumption behind all of this is that a dollar is somehow a fixed value over time. It isn’t. It continually declines, sometimes at galloping speed. My suspicion is that, for most of us, the $114,000 we’ve paid in was “worth” far more than the $355,000 we can expect in return.
Teatime2, what many in my generation are coming to realize is the fact that by the time we ever come close to a point of needing to dig into medicare, it will either be a joke (not even near enough to cover what we need) or it will be bankrupt and in either case unhelpful. We are realizing that we are being asked to pay a tax that we will never be given anything back for, even though that is what we are promised. We would rather see it gradually phased out and given our own money than to give it to the government for promises that they will never be abel to fulfill in 35-45 years or so.
Yet taking money from the younger generations that received no benefit will still not solve the inflation issue, it will just continue to harm the younger generation. And, the younger generation did not institute this system, so why should they pay for the inflation losses of those that did?
Re: #19
[blockquote]The assumption behind all of this is that a dollar is somehow a fixed value over time. It isn’t. It continually declines, sometimes at galloping speed. My suspicion is that, for most of us, the $114,000 we’ve paid in was “worth†far more than the $355,000 we can expect in return.[/blockquote]
From the article:
I’d suggest that if one set of numbers given by this think tank were in 2010 dollars in order to enable a direct comparison, they all were. Inflation has already been factored in to the 3:1 figure.
As it stands, everything I’ve read about the program seems to indicate that the money was gathered was never invested to create the money needed to cover the benefits, nor was it gathered from the beneficiaries in anything like the amounts needed. The assumption was that the economy would grow sufficiently that each generation could pay for the previous generation, and that the money coming in would be at least as much as that going out.
Those assumptions all look highly suspect now and I have seen nothing that suggests anything other than that the program is either going to go bankrupt under the current approach or swallow up most of the federal budget.
An alternative, as I envision it, would be to require everyone to establish a medical insurance savings account which could not be used for anything other than medical expenses. The problem, though, is that so many people make imprudent financial decisions which drain their savings or prevent them from establishing savings accounts in the first place. People need to be educated about the importance of making sound financial decisions, and it needs to start at an early age.
#3 is correct; the employee and employer contribute equal amounts. It is not clear if the $114k isboth shares or just the employee share. (Of course the self-employed pay double.)
Similarly, #13 and 19 are likely correct that the present value of the $114k is likely greater than the $355k in benefits because of the many years of earnings over the 40-50 years of employment.
#24 What earnings? The money went to the government program. It wasn’t invested in anything. It went in, it was spent. I don’t know of any “earnings” associated with Medicare taxes payed in. If you do, please provide that information. The only thing I see is that the program doesn’t take in enough to cover the benefits it was providing recipients, so those that receive benefits are getting money from those that are not receiving (or even eligible to receive) benefits. It is a transfer of wealth from one group (typically the younger generation) to another group. There is no investment going on…no “earnings” on money put in.
In fact, the money that goes in isn’t even “saved” for the people that are putting it in. It is spent as fast as it comes in. It is and has always been a “Pay-Go” system. Since 2008, more money has gone out of the system than was taken in. That means that the small number of retirees today are using ALL of the taxes that are going into the system and more, so that the funding is being funded by debt. It is not a self sustaining insurance program and never has been. It has always relied on sufficient workers pumping money in to cover the lack of money that the recipients did not put in.
What is happening is that the Boomer demographic bulge has hit the system and something like 10,000 more Boomers are retiring daily and will be for the next 15 – 20 years. There used to be about 3 workers for every retiree, but that is changing to only 2 workers per retiree. Since the retirees didn’t save enough money to fund their retirements and medical expenses, they are getting that money from the current workers…but there aren’t enough current workers paying in because we had an abortion frenzy by the generation that is retiring, the off-shoring of jobs, and the now high unemployment rate.
The well is dry. Enjoy that last cup of water while it lasts. The FED is busy monetizing the debt through quantitative easing, so retirees will get the dollars that they were promised, but those dollars will be worth less and less as the years go by. Have you looked at the gas pump lately? In our area, gas went up from about $2.90 to about $3.30 in the past 2 months. The reason? The FED started pumping $150 Billioin per month into low interest Treasury Bills.
Where did the FED get that kind of money? They printed it out of thin air. That means that the real value of the total quantity of money is being being reduced by $150 Billion every month…the dollars in your pocket are having less and less worth. Other countries aren’t stupid. They know what is going on. The Dollar (and all currencies) are on sliding scales because they are fiat currencies. But the commodities that the currencies can purchase are not on a sliding scale…so it will take more dollars to buy things like gasoline because the dollars are worth $150 billion/total dollars per month. It doesn’t show up as much inflation because the system of measuring inflation (Consumer Price Index -1) doesn’t take into account fuel and food costs. So things like SS benefits don’t get an increase as fast as the prices for basic necessities (like food and heating oil) rise rapidly. It is a “win-win” for the government. They keep their promise to pay you x number of dollars a year, increased by CPI-1 to cover inflation. Meanwhile, they inflate the currency but the metrics they use to determine inflation do not reflect (except indirectly) the inflation that they are creating. You end up getting less and less purchasing power while getting more and more dollars…way more dollars than you ever payed in…but the dollars are becoming worthless.
That’s the name of the game right now. The danger will be hyper-inflation/stagflation. If that happens, look for a “strong man” to step into our political scene and take power. The jig is up. The Republic is having it’s last gasp because the masses learned to vote for bread and circuses (Social Security, Medicare, Welfare, Never Ending Unemployment Benefits, etc.). Margaret Thatcher said it well; “The problem with socialism is that you eventually run out of other people’s money.” Well, “eventually” is now.
Sick and Tired — I have to largely disagree with your comment #18.
RE: “I think that it is honorable to pay back what people put into the system (that they designed, approved, and implemented) that is failing. What is not honorable, but rather the height of selfishness, is to continue to take from the younger generation and enslave through debt their children’s children. By all means, people currently receiving benefits should receive the balance of their money back.”
But that eliminates the opportunity benefit that these people had with what was a large sum of money. Nobody takes 180K and just lets it sit there meaninglessly. People invest it. Buy things. Put it into a CD for heavens sakes. Buy long-term disability insurance. Or whatever.
We took their money — as my money is being taken — and then spent it on other budget items entirely having nothing whatsoever to do with their need for medical care in their elderly years.
Furthermore it is not simply the Baby Boomers who voted all of this ultimately unworkable State collectivism in. One of the largest Obama-voting segments was the millennials.
No — Obama — and Jimmy Carter — and our Senate and House representatives represent us as a whole. It is a devastating indictment on our country but there it is. The reason Obama was elected was because he perfectly represents America as voted upon by a majority. So it is meaningless to say “they voted all of this in — let them pay.” The country wrongly voted all of this in — and we will most certainly pay for it.
My prayer is that we will learn from all of this. We will vote. We will research candidates who are unwilling to follow their vows to follow the Constitution and not vote for them. We will run for office. And we will do any number of other things necessary to actually running a civilized, Constitutional, state-limited country.
So, where will the money come from?
How will we even afford to pay the interest on the debt?
The quantitative easing has already begun. The course is set.
We are balanced on the edge of a financial razor and history does not give us reason to hope that we will recover from this. I think that it is a very likely scenario that we will end up with stagflation with the inflation portion being hyper. That will lead to political instability that our nation has never seriously encountered and it will happen at a time when our moral compass has been broken by the rock of post modernism and when our culture is post-Christian. The United States has never been here before.
Getting back to the question at hand, I asked where the money will come from. We both know that there is no “trust fund” with this money in it. So, that leaves those that are currently working to pay for Medicare. Right now, with 9.9% unemployment, and at the start of the Boomer’s retirement tsunami, we already are paying into Medicare less than what Medicare is paying out. We have been for 2 years. However, even at full employment, the demographics will not sustain this arrangement. We currently have 3.5 workers for each person receiving benefits and that isn’t enough to pay the current bills. We are adding another Trillion dollars to the debt this year. We will all too soon be down to a ratio of 2.3 workers per person receiving benefits. That will be a 36% reduction in the ratio between the number of people working to pay and the number receiving and that is currently not enough to keep things going.
So what to do? Raise taxes? Ok, lets raise the payroll taxes by 40% on every worker, so now the top rate is 68% Medicare and income taxes and all those not paying income taxes (about 47% of Americans) will now have the joy of paying at least 40% in Medicare tax. So let’s see, the bottom of the tax brackets will pay 40% in Medicare tax and 6.5% in Social Security. That leaves the bottom tax brackets paying a regressive payroll tax of 46.5% and the top end paying at least 74.5% in combined payroll and income tax. Now remember, that is still not enough to actually pay the costs of Medicare or keep Social Security solvent…let alone pay the interest on the Federal Debt or any other Federal program’s bills.
So, what will they do? They will print money. What will that accomplish?
We cannot afford this now. How can we afford it when 40 million more Boomers retire? Social Security and Medicare are ponzi schemes and the jig is up.
You know what…it doesn’t matter what I say or think or do or want…the system is bankrupt. What part of “we are going another Trillion Dollars in debt this year” do people not understand? We have a $13.9 Trillion dollar debt NOW. The entire GDP of the nation is only 14.7 Trillion. By the end of this year…2011…the debt will exceed the entire GDP. Interest on the current debt is $3.5 Trillion. Federal tax revenues are $2.1 Trillion. BTW, none of the debt mentioned includes the $111 Trillion in “unfunded” debt. You could confiscate everything everyone has…everything…and we would not have 1/5th the assets needed to pay the per person debt on the unfunded liabilities.
Like I said…it doesn’t matter what we want to have happen. This is what is happening: http://www.usdebtclock.org/
La, la…all is well…
Well, I didn’t say we shouldn’t drastically reduce *benefits* of Medicare. Medicare shouldn’t be covering a ton of stuff that it does. We’d be shoestring coverage — any things not covered by Medicare would have to be paid out of pocket. Plus all of that would be funnelled down to the states with block grants — states could then choose how they were going to spend that money based on their local needs, and most would probably choose the old — and excellent — local health care clinics. And we’d end right off the bat the whole law that demands that doctors can’t give charity or free care to those whom they wish to.
And regarding Social Security, I’d raise the retirement age for all those 50 to 60 to 80. Those 50 and under get to opt out.
Tough breaks for sure.
But there are simply masses of options that plenty of free-market experts have come up with make the care of the old more market-friendly and deal with the budget issues.
My issue is *lying* to people, *stealing* their money, and then backing out of those theft-based promises. It’s one thing to take away an entitlement that should never have been given. But once you’ve stolen people’s money in order to pay for a State-insurance plan — it’s a whole new ball game. You’ve entered into a contract with those people from whom you stole that money.
Well, I am in that same contract. I have been working for 33 years, since age 14. I am not yet 50, and I have zero expectations from either SS or Medicare. Yet I have the same promises, I have paid in just as they have. If we end it now, at least they will have received some benefit. I and millions like me will get nothing. They benefit from my loss. All I am asking is that we stop the theft and quit going further into debt…enslaving my kids.
But, I honestly do not think it matters anymore. I think we are past the point of no return in our economy. Our ability to pay the interest on the debt, let alone pay down the debt is questionable. We will “monetize” the debt, and that will lead to our rating dropping, so credit will cost even more, which sets up a vicious cycle. That will lead to hyper-inflation, because commodities like oil don’t play the “fiat” game. They have real value, not just “full faith and credit”. We won’t have wheelbarrows of money, because it is all plastic now, but you will see people rushing to the store on payday to spend their money before it becomes worthless. Interest rates will soar and credit will become nearly impossible. There will be fights and food riots. Crime will increase. People will demand law and order and a strong man will come to power. The End.
What magic wand will the “free-market experts” wave to prevent this scenario from unfolding? If the FED raises interest rate right now, like Paul Volcker did in the 70’s, if we withdraw from the wars, slash domestic spending, and raise taxes to extremely high levels, we will stall the economy for several years and create massive unemployment. If we do that, we might just possibly get out from this debt, but I doubt it. So the alternative is to print money and suffer the hyper-inflation as we “pay” that 14 Trillion Dollars in debt. We may end up in a war with China and/or others over that as they demand something real for the Billions of dollars they lent us. After all, our monetization is actually stealing from them. This socialism we have is so corrosive and evil, it’s hard to know what to think.
I really wouldn’t worry about it. The fix is in. About 1/3 of the nations hospitals will go bust in the next 3 years, and 1/2 in the following 5. Most physicians will stop accepting Medicare. Thus, seniors, faced with driving 300 miles to see their cardiologist after being on a waiting list for 6 months will decide to stay home. So they will die early, and this will “save” both medicare and social security.
Problem solved. Can we eat now?
Yep…don’t worry about it. Today’s headline read that the national debt was now $14 Trillion. According to the Dept. of Treasury, it too just “…7 months for the National Debt to increase from $13 trillion on June 1, 2010 to $14 trillion on Dec. 31…”
What’s to worry about? Eat while you can.
STN,
“Earnings” actually has two meanings in the current discussion. First, the relative value of $114k paid over time must be evaluated in light of the $355k paid in future installments. That can only be done by estimating what the taxpayer (not the gov’t) might have earned, to see which side of the ledger is worth more.
Second, earnings can refer to the interest earned on surplus SS collections that must be invested in US securities. (The proceeds of those securities- but not the SS receipts themselves- are used to fund govt operations.) there is no “lockbox”, but there is a separate accounting for SS.
Either way, the point is that the present value of the SS taxes paid appears likely to exceed that of the payments received for the taxpayer.