Well the article which is an exclusive explains the details , I mean its all been said anyway. We KNEW the day would come where in we would suffer deficits in SS, no one thought it would be this close and we certtionaly need the breathing space.

Its worth mentioning that IF the economy starts humming this may track back some, but the tsunami is out there and we are just waiting for the wave to hit....we need to stop adding more entitlements and start cutting the never ending funding of those that don't operate efficiently ( well that can be any gov. prgm but you get my point) and the ones that are nice to haves but not have to haves.

The ability of the American tax payer to keep the country afloat is about to undergo its most severe test...and the writing is on the wall folks.


Exclusive: CBO predicts Social Security cash deficits in 2010-11

Four years ago, George W. Bush attempted to reform the entitlement program Social Security, warning that the system was accelerating into collapse and would soon run deficits. Democrats scoffed and claimed the Social Security system was solid and wouldn’t have problems for at least 50 years, as Harry Reid told PBS’ Jim Lehrer in June 2005. Just last year, the CBO — under the direction of Peter Orszag, now budget director in the Obama administration — claimed that the first cash deficits in Social Security would not come until 2019.

Now, however, the CBO has determined that Social Security will run cash deficits next year and in 2011, and by 2016 will be more or less in permanent deficit mode. Hot Air has exclusively obtained the summer 2009 CBO report sent to legislators on Capitol Hill but not yet made public, which shows that outgo will exceed income for the first time since the 1983 fix on an annual basis in 2010:

see graph

The numbers need explaining. The number to watch is the “Primary Surplus” number, which watches actual income and expenditures without the interest payments from the general fund. The interest payments mask the fact that costs have begun to outstrip income on an annual basis (individual months have gone into deficit in the past). One way to look at this, according to my sources, is to think of this as a mortgage, and in 2010-11, the income can’t make the payments, so the general fund has to cover them. Since the interest obligation compounds, the debt grows.


As we can see, this trend reverses itself temporarily from 2012-15, but the surpluses are minimal. By 2016, the deficits return, and begin to accelerate again. By 2019, the primary surplus runs $63 billion in the red, almost triple the deficit in 2017, showing the rapid decline of the Social Security system.
This demonstrates nothing better than the poor and politically calculated analyses that came out of the CBO during Peter Orszag’s tenure at the Congressional agency. Democrats wanted analyses that allowed them to ignore the problems in Social Security, and Orszag was happy to supply them. Douglas Elmendorf has had to right the ship at CBO while Orszag continues to blow his predictions at OMB, most notably in overall deficit projections, which Orszag had to admit were off by more than 40% and $2.2 trillion over the next ten years.

Of course, they were helped along by a complacent media unwilling to do math, and a host of apologists for the Left. Chuck Blahous at the Hudson Institute has a good rundown of those he calls the “mythmakers”. It’s worth reading in its entirety, as is Robert Reich’s “All is well!” blogpost from four months ago, apparently working off of the Orszag numbers from last year.


The situation at Social Security is much worse than this administration and Democrats in Congress want to admit. They want to continue busting the deficit and creating new entitlements while the existing ones careen towards collapse. The new data shows that time has almost run out for reform. Seniors will still get their checks, but those will increasingly rely on injections from the general fund and not revenues from Social Security payments. At this point, one has to wonder when SSA becomes a flat-out Ponzi scheme, and who the suckers will be when it blows up.


Hot Air Blog Archive Exclusive: CBO predicts Social Security cash deficits in 2010-11

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"The captain has turned off the `No Dubbing' sign. You are free to speak any language you choose."

Another great disaster to not let go to waste !

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Jesus loves you, allah wants you dead

"Every government interference in the economy consists of giving an unearned benefit, extorted by force, to some men at the expense of others."

Ayn Rand

Hot Air has received a report from the Congressional Office Budget that has been sent to legislators, but not yet released to the public, showing that Social Security will go broke not in ten years, or 20 years, or 50 years, but next year. The report, which you can view here, shows Social Security running a deficit next year and then permanent deficits getting larger and larger starting in 2016.

Now you may recall that in 2005 then President Bush tried to reform Social Security by allowing younger workers to invest 4% of the payroll tax they pay into private accounts so that we would actually get back some of the what we put into the system since our parents are going to blow it all. You may also recall that the Democrats had a hissey fit and then went running around the country scaring old people into believing Republicans were trying to take away their Social Security, which anyone with common sense knew was a lie. Being the horrible communicator that Bush was, he naturally failed to make the case as to why reform was necessary and the Democrats got away with scaring grandma and the Republicans ran away from the plan with their tail between their legs being the usual wimps that they are. Harry Reid, in particular, said that there was absolutely nothing wrong with Social Security and it was rock solid for another 50 years. The Republicans just wanted to get rid of it because they've always hated it.

I like at the end how Reid says Bush’s plan was an effort to steer talk away from the huge national debt we have. My, how his attitude has changed on that one.

So I wonder now what the excuse will be as this report becomes more public. It’s already been whipping through the Internet today.

Social Security is going broke next year. Medicare is set to go broke in less than ten years and somehow we will magically come up with a trillion dollars to pay for health insurance for five percent of the American population.

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Carolina Politics Online

HOPE AND CHANGE

Republicans have always hated Social Security and have always wanted to get rid of it?

That's a new one on me.

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My good blade carves the casques of men,
My tough lance thrusteth sure,
My strength is as the strength of ten,
Because my heart is pure.

"Sir Galahad," by Alfred, Lord Tennyson (1834)

If you owe $1,000,000 dollars and you only have $999,999, would you define that as broke?

What if you had the full legal authority to print money. Would you still define that as broke?



The solution to SS is simple. It should only be collectible based upon need. Yes, that would piss ~100,000,000 americans off who paid more into the system than they will get out. That would seem to be better than saddling the nation's children and grandchildren with an even bigger problem.

This is only breaking news to those that have public school math skills or are just plain ignorant.

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"If you think about it, UPS and FedEx are doing just fine," he said. "It's the post office that's always having problems." Barack Obama on government run healthcare. 08/11/2009

American by birth.
Conservative by the grace of God.

Still sore about the war of northern aggression.

threads merged.

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"The captain has turned off the `No Dubbing' sign. You are free to speak any language you choose."

So... basically... everyone should throw their money into a pit so that those that don't plan for retirement can get something? The government should tell people "we know that you have paid into the system all your life... but we squandered away the money so you can just go fuck yourself"????

What????

How about if I am permitted to opt out of social security and invest my money where I see fit?

SS is nothing more than a ponzi scheme that the American people are forced into.

Yet another bullshit program brought to the American people from the government that is "just here to help".

And people don't understand those of us who don't trust them with health care.

SS has been raided repeatedly over the years. Those that took the money out can put it back in!

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This is actually a pretty poor idea. The idea for social security is that it is there so you can retire even if the markets aren't performing well. If social security is invested in the market, you may as well simply let people focus on their IRAs or similar.

I'd rather just see the thing means tested, with a decrease for additional monthly income which isn't 1:1. With that Social Security will perform its purpose longer, more effectively, and with a more noticeable impact on the lives of seniors.

Also it will help get them out of the job market during recessions.

No its that you have paid into the system which is there not to insure you not to benefit you but to insure the economy. The fact it helps seniors who have lost part of their retirement funds is merely a trait of the best way to insure that economy.

No, because if there is a recession you'll proceed to keep working past retirement because your plan was delayed by the economy. Because you don't leave, the person who was looking to take your job can't get his promotion so he stays where he is and down the chain until you get to a bunch of new entrants to the job market who can't get a job and this is a problem for governments.

More along the lines of this:

You face a deficit between your income and outlays of 63 billion dollars. You own approximately one quarter of the US government bonds/bills/notes/etc in existence today, are you broke?

Social security doesn't face problems so long as the US government does not default on its loans. The United States will however face higher interest rates for its own loans, now that social security will not longer be purchasing them. However, we have been steadily facing this for quite some time as the rate at which they have been purchasing bonds has been decreasing.

Since the money supply is not based upon a fixed standard, the government in theory will never default on its loans because it can just print enough money to cover them. That of course causes inflation, etc, so its not the cure-all for rampant spending.

Melanie, think of it this way: The money you pay into SS now is being used to build roads, bridges, military, etc, all of the things they normally would tax you additionally for. Since there is no SS 'lockbox' the money received is immediately spent - and usually its not spent as checks to SS recipients. If the government had a 'lockbox', then you would be entitled to get your money back some day but you'd be paying way higher taxes today to pay for roads, military and all of the other things the SS surplus money is spent on.

I'd rather just call it a wash, and only pay SS on proven need (scaled with income or something) and only at a subsistence level so the system isn't intentionally abused.

I've never 'expected' to get SS when I retire, I 'expect' the system will be bankrupt by then and something else will be the norm by then. So I plan for my own retirement and if I ever do see a dime from SS, then that's just icing.

No, of course not, but that assumes that you have the capability of making up that shortfall through your earning power. Once the Social Security Fund goes negative, it will not be able to make up that shortfall anytime in the foreseeable future (barring tax increases and/or benefit reductions). That is the way that Ponzi schemes always end.

Yes, because embarking down the money printing road full scale, will destroy the currency. It will happen in the United States, it is only a matter of when.

Those ~100,000,000 Americans tend to turn out to vote at a high rate. The nation's children and grandchildren don't - hell, many of them can't - because they aren't yet old enough. Thus, your solution is neither simple, nor plausible.

Melanie, do not be surprised. This is the basic playbook for every Democrat social program.

No, that can't be allowed to happen, for then the grip of big government will be loosened not only on those who pay into the scam, but also on those who are dependent on the scam, as the total fund will be smaller.

Take heart, as all Ponzi schemes eventually collapse.