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This is a good piece of data to take into the Catfood Commission II hearings. Remember how Bernie Sanders and other Social Security defenders insist that Social Security is solvent and on track to pay full benefits for the next 26 years? It turns out they’re wrong. It’s able to pay in full for 28 years, according to the Congressional Budget Office:
CBO projects that the DI trust fund will be exhausted in fiscal year 2018 and that the OASI trust fund will be exhausted in 2042. Once a trust fund’s balance has fallen to zero and current revenues are insufficient to cover the benefits that are specified in law, a program will be unable to pay full benefits without changes in law. The DI trust fund came close to exhaustion in 1994, but that outcome was prevented by legislation that redirected revenue from the OASI trust fund to the DI trust fund. In part because of that experience, it is a common analytical convention to consider the DI and OASI trust funds as combined. CBO projects that, if legislation to shift resources from the OASI trust fund to the DI trust fund was enacted, the combined OASDI trust funds would be exhausted in 2039.
This follows a four-year period of declining payroll tax revenues because of rising unemployment. The easiest way to “fix” Social Security, which is probably in better financial shape than any program in the federal government, is to get more people working and paying into the payroll tax. Better job growth alone would push out the solvency to at least 30 years, if not more. Increased wages and an influx of legal high-skilled immigrants wouldn’t hurt either. Then you could provide a path to citizenship for the undocumented and fold them into the legitimate economy, capturing their payroll tax (which is a short-run net benefit). After that, if you want to control for historic inequality by increasing the payroll tax cap to cover 90% of compensation, as the program was intended, fine.
But it’s simply dishonest to say that Social Security is bankrupt or even going bankrupt. It’s scheduled to pay full benefits for 28 years, even after a half-decade of bad job numbers.
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as is DOD and DHS. Right? Wait, where are all those deficit hawks when you need them?
Obama, as it turns out, is a Blue Dog Democrat which is no biggie, except that’s not how he was portrayed by his campaign in ’08. Though he lied about his views during the 2008 election, his continued pursuit, along with the GOP and many DINO’s to show SS account as problematic is beyond the pale. A lying president, Administration and Congress. What a trifecta.
Social Security is an ENTITLEMENT to be REFORMED in a BIPARTISAN COMPROMISE. What else is it good for?
I hope you’re kidding. First it’s not an entitlement, people and employers put the money into an account,you know, like a savings account. Second it’s my money and I want it back, not give it to some wall street crook to gamble away.
O has been flogging payroll tax ‘holidays’ as a stimulative measure. There have, I think, been two already. He’s talking about more. If the trust fund projects to be too sounds for too long, it would make sense for O to deplete it.
I’m pretty sure that was greenbell‘s sarcastic voice. (Sounds like his/her regular voice, I suppose.)
Everybody who thinks these facts about Social Security’s solvency will affect policy one iota, raise your hands. Yeah, me neither.
Why the silence in MSM about these facts? Why the coy references to ‘changes’ in SS? Oh, well, I guess I know the answer to that one…
If people are appointed to the Committee of the Twelve Caesars who are the deficit hawks Obama wants and the anti-taxers that Norquist wants, it won’t matter how solvent SocSec is. It will be “messed with,” cut, have age increase, get the Chained CPI maltreatment, or any and all awful things done to it. And to us.
Obama sold us down the river — and he’s hoping we’ll drown on the way. Or at least STFU.
It’s the Holy Grail of the Wall Street thieves. The Third Way founder is a big fan of Social Security privatization.
Obama was sent to the White House to do this job:
http://www.washingtonpost.com/wp-dyn/content/article/2009/01/15/AR2009011504114.html
Obama Pledges Entitlement Reform
President-Elect Says He’ll Reshape Social Security, Medicare Programs
Friday, January 16, 2009
President-elect Barack Obama pledged yesterday to shape a new Social Security and Medicare “bargain” with the American people, saying that the nation’s long-term economic recovery cannot be attained unless the government finally gets control over its most costly entitlement programs.
Folks, save a link to this article, and forward it to every lazy reporter who files the “OMG, Social security will run out; we’ve got to ‘strengthen’ it” and “social security has big problems, so let’s attack the deficit” story. You’re going to be seeing a LOT of those in the coming weeks.
This also would make a good basis for letters to the editor of your local paper — often a better way to reach folks than the paper’s non-coverage of the facts.
But seriously: attack, attack, attack re this “social security is bankrupt” lie.
I agree joe, what they should do is take the lousy cap off. So the rich can pay their fair share.
The CBO website has a new infographic on Social Security.
Check out the chart titled Federal Noninterest Spending the dark blue
portion of the bar chart on the bottom shows Social Security spending
until 2080.
It shows Social Security spending is basically flat and is
not a major driver of long term budget deficits.
pJack
no. it sounds good. but it’s the wrong way to go. Social Security was designed NOT to be welfare. It is important that the workers continue to pay for it themselves. They can do this forever with a tiny increase in the tax to pay for their longer life expectancy. One half of one tenth of one percent per year will do it. That’s about forty cents per week.
When you turn it into class war, we lose.
It’s bad enough that the Petersons and the PRess and the President are lying about it now. Raising the cap would make their lies “true.”
But you must keep telling everyone every chance you get: Social Security has not a damn thing to do with the budget deficits. The workers pay for it themselves.
And if you don’t understand yourself, it’s because you have been lied to about it for thirty years.