Social Security trustees see earlier fund depletion date

[dm1333]

http://nbcpolitics.msnbc.msn.com/_news/2012/04/23/11355323-social-security-trustees-see-earlier-fund-depletion-date?lite

The trustees of the Social Security system said Monday the fund that helps sustain retiree and survivors’ benefits will become exhausted in 2033, three years sooner than they projected last year.

At that point, payroll taxes and taxation of Social Security benefits will provide only enough income to pay about 75 percent of the benefits that Congress has promised to retirees and survivors.

In practical terms, this means that a 40-year-old worker who is eligible to collect retirement benefits in 2039, would see his or her expected retirement benefit cut by about 25 percent, unless Congress took action to change the program’s funding or its benefit structure.

“The redemption of those bonds can only occur out of current income,” explained Senate Budget Committee chairman Kent Conrad last year. “The general fund has been borrowing from Social Security and we've borrowed well over $2 trillion,” he said. “That money has got to be paid back. How's it going to be paid back? It's going to be paid back by the other general expenditures of the federal government having to be reduced to make way for the payments that we're going to have to make on those bonds.”

Followed by this gem!

House Democratic leader Nancy Pelosi said, “Despite the repeated efforts of Republicans to privatize Social Security and end the Medicare guarantee, these vital initiatives remain strong.  Today’s Trustees’ report affirms that Social Security and Medicare will continue to provide critical benefits to seniors and other Americans.”

AFL-CIO President Richard L. Trumka said in a statement that the report “confirms that Social Security remains a vibrant, strong, and durable program….The Social Security surplus is large and growing. Despite lower than expected wage and economic growth and unexpected increases in the cost of living, Social Security will be able to pay full scheduled benefits at least until 2033 absent congressional action.”

[Boomhauer]

Followed by this gem!

The Ministry of Truth has spoken!

[vaskidmark]

“The redemption of those bonds can only occur out of current income,” explained Senate Budget Committee chairman Kent Conrad last year. “The general fund has been borrowing from Social Security and we've borrowed well over $2 trillion,” he said. “That money has got to be paid back. How's it going to be paid back? It's going to be paid back by the other general expenditures of the federal government having to be reduced to make way for the payments that we're going to have to make on those bonds.”

Apparently this explains why the number of government employees seen purchasing Lotto tickets has increased.

More chance of winning the lottery than getting federal spending reduced by anything meaningful.

stay safe.

[Jamie B]

Pelosi did not lie - she simply neglected to use a specific time frame.

How convenient...

[Monkeyleg]

It seems that every time someone issues a pronouncement about SS, the day of reckoning gets moved up. By the time I'm eligible to collect full benefits--just six years from now--the fund will be broke.

I wish I could have a few private minutes every member of congress who voted to raid SS, and every president who helped raid it. I wouldn't talk much.

[Hutch]

We're sooooo screwed.  Pols unwilling to choose the least bad option, hoping that a painless one will come along to save us.  I just hope we do to our solons what the Cartheginians did with theirs, once the Romans showed up at their walls.  (hint:  it wasn't pleasant)

I expect the value of the greenback to fall to near zero within my lifetime.  I just hope what we emerge with as a society after this is not a dictatorship.  Statists got us into this.  I hope that makes it into the histories that are taught in generations to come.

[Tallpine]

I expect the value of the greenback to fall to near zero within my lifetime.

The value has fallen about 99% in the last hundred years.

How much closer to Zero do you expect it to go 

[Hutch]

Actually, my fear is we will all be millionaires. 

Since the inception of the Fed, the dollar has only lost 95% of its value.  No need to embellish, the truth is grim enough.

I was speaking to the other Grandfather of my grandsons (co-grandfather?) and we discussed how best to put aside wealth for their education.  It was a sobering event.  What might have value in 16-17 years?  I trust nothing.

[birdman]

THERE IS NO "FUND"
The "fund" is US treasuries HELD by the SSA.

ALL social security benefits are PAID by general revenue, and the amount collected by the FICA portion of taxes is less than the payments (which are considered part of general revenue).

By my reckoning, given the massive deficits, that means it is ALREADY insolvent--its dedicated taxes can no longer pay its benefits, and the NPV of its liabilities is already even larger than the current publicly held federal debt.

What they mean when they project this "insolvency" is the date when EVEN IF the federal government can pay the SSA runs out of treasuries to reclaim.

It's a double-ponzi scheme...not only is it paying out more than it takes in, but it's meager dedicated taxes have been "borrowed" as well.  (one of the reasons for the fake "surplus" in the Clinton years)

Only in government can you spend more than you receive in income and still consider it a surplus.