SS in trouble this year..

[R13]

The bursting of the real estate bubble and the ensuing recession have hammered jobs, home prices and now Social Security.

This year, the system will pay out more in benefits than it receives in payroll taxes, an important threshold it was not expected to cross until at least 2016, according to the Congressional Budget Office.

Stephen C. Goss, chief actuary of the Social Security Administration, said that while the Congressional projection would probably be borne out, the change would have no effect on benefits in 2010 and retirees would keep receiving their checks as usual.
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The problem, he said, is that payments have risen more than expected during the downturn, because jobs disappeared and people applied for benefits sooner than they had planned. At the same time, the program?s revenue has fallen sharply, because millions of jobs have disappeared, leaving fewer paychecks to tax.

Tipping point
Analysts have long tried to predict the year when Social Security would pay out more than it took in because they view it as a tipping point ? the first step of a long, slow march to insolvency, unless Congress strengthens the program?s finances.

?When the level of the trust fund gets to zero, you have to cut benefits,? Alan Greenspan, architect of the plan to rescue the Social Security program the last time it got into trouble, in the early 1980s, said on Wednesday.

That episode was more dire because the fund could have fallen to zero in a matter of months. But partly because of steps taken in those years, and partly because of many years of robust economic growth, the latest projections show the program will not exhaust its funds until about 2037.

Still, Mr. Greenspan, who later became chairman of the Federal Reserve Board, said: ?I think very much the same issue exists today. Because of the size of the contraction in economic activity, unless we get an immediate and sharp recovery, the revenues of the trust fund will be tracking lower for a number of years.?

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The Social Security Administration is expected to issue in a few weeks its own numbers for the current year within the annual report from its board of trustees. The administration has six board members: three from the president?s cabinet, two representatives of the public and the Social Security commissioner.

Though Social Security uses slightly different methods, the official numbers are expected to roughly track the Congressional projections, which were one page of a voluminous analysis of the federal budget proposed by President Obama in January.

Mr. Goss said Social Security?s annual report last year projected revenue would more than cover payouts until at least 2016 because economists expected a quicker, stronger recovery from the crisis. Officials foresaw an average unemployment rate of 8.2 percent in 2009 and 8.8 percent this year, though unemployment is hovering at nearly 10 percent.

The trustees did foresee, in late 2008, that the recession would be severe enough to deplete Social Security?s funds more quickly than previously projected. They moved the year of reckoning forward, to 2037 from 2041. Mr. Goss declined to reveal the contents of the forthcoming annual report, but said people should not expect the date to lurch forward again.

The long-term costs of Social Security present further problems for politicians, who are already struggling over how to reduce the nation?s debt. The national predicament echoes that of many European governments, which are facing market pressure to re-examine their commitments to generous pensions over extended retirements.

NYT: Social Security payout to exceed revenue - The New York Times- msnbc.com

[Counts]

Great it will run out of money when I turn 63


Honistly it is not like this is new news and in all honisty SS is screwed now since the Goverment surpluss of SS money comming in was only on paper and in actualaty it was used EVERYWHERE else (This has been done by Dems and Reps no one is clean in this mess)


IMHO SS benifits will have to be cut AND the SS tax will have to be raised neather of those things will make voters happy so i look for the Gov to put off the problem until it is unfixable then blame in on eachother

[sup-rbeast]

The problem is, we've known about what was happening to SS for well over a decade. Yet, we dumped trillions we could have used to fix it into fighting a needless war in Iraq and lining the pockets of Big Oil. It's a shame really.

[Counts]

The problem is, we've known about what was happening to SS for well over a decade. Yet, we dumped trillions we could have used to fix it into fighting a needless war in Iraq and lining the pockets of Big Oil. It's a shame really.

Everyone with any sence has seen this comming since the late 70's when it was clear that Gen X was not going to be anywhere close to the size of the Baby Boomers.

Reguardless of what some may think the money you pay into SS does not entitle you the ANYTHING you are simply supporting those who are already Drawing SS and hope that the next generation will be able to support you when the time comes

Bush pushed for SS reform in 05 and honistly it was the begining of the end for him politicly......That is one reason I think that the Dems will not want to touch this issue with a 10 foot pole

[simple man]

Everyone with any sence has seen this comming since the late 70's when it was clear that Gen X was not going to be anywhere close to the size of the Baby Boomers.

Reguardless of what some may think the money you pay into SS does not entitle you the ANYTHING you are simply supporting those who are already Drawing SS and hope that the next generation will be able to support you when the time comes

Bush pushed for SS reform in 05 and honistly it was the begining of the end for him politicly......That is one reason I think that the Dems will not want to touch this issue with a 10 foot pole

You might want to study Bush more...folks voted for him because he was going to "fix" SS. When he was approached about the problem, he didn't make a move till the window to split the SS plan was gone. He never gave the thing a thought, other than "How can I get elected?" There a couple of books in the local library system that tell the story.

[sup-rbeast]

Everyone with any sence has seen this comming since the late 70's when it was clear that Gen X was not going to be anywhere close to the size of the Baby Boomers.

Reguardless of what some may think the money you pay into SS does not entitle you the ANYTHING you are simply supporting those who are already Drawing SS and hope that the next generation will be able to support you when the time comes

Bush pushed for SS reform in 05 and honistly it was the begining of the end for him politicly......That is one reason I think that the Dems will not want to touch this issue with a 10 foot pole

If we had listened to Bush, our money would have been put in a failing stock market instead of SSI where it belonged...that would've worked out well.. Bush didn't offer a fix, he offered a way to further the gap between the haves and the have nots.

[Counts]

You might want to study Bush more...folks voted for him because he was going to "fix" SS. When he was approached about the problem, he didn't make a move till the window to split the SS plan was gone. He never gave the thing a thought, other than "How can I get elected?" There a couple of books in the local library system that tell the story.

I don't disagree with you NOONE wants to do what is needed to fix the problem (If there even is a fix) Carter could have "Fixed it" so could Region and Bush #1 Clinton had the perfect chance to fix it then Bush waited till his 2nd term and by then I am not sure it could have been fixed

IMHO OBAMA has no desire to tackel this one and in all honisty it is a no win situation the party out of Power will campain on any "negative" change in SS HARD

[Counts]

If we had listened to Bush, our money would have been put in a failing stock market instead of SSI where it belonged...that would've worked out well.. Bush didn't offer a fix, he offered a way to further the gap between the haves and the have nots.

Stock market is not falling just ask R13

In all honisty Money into the market would have been a better plan 20 years ago with the Baby boomers retireing NOW there is nothing left to pump into the system all money collected will now be payed out and the "Trust Fund" is nothing more than a big IOU to the Gov from the Gov (Pretty much the same kind of accounting that got ENRON in trouble)

[R13]

Stock market is not falling just ask R13

Don't have to ask me, just look at the stock market, the Dow has has well over 3,000 points, close to 4, since the stimulus. The economy is recovering and the stock market sure as hell has, but its just not smart to tie up SS in a large casino on Wall Street..that's just common sense no matter what its doing at the moment.

There's several problems with SS, more people could pay into and people are just living a lot longer these days(which isn't anyones fault) but that's been a huge problem. The age is going to have to be moved up about 5 years and the cap removed.

[Counts]

Don't have to ask me, just look at the stock market, the Dow has has well over 3,000 points, close to 4, since the stimulus. The economy is recovering and the stock market sure as hell has, but its just not smart to tie up SS in a large casino on Wall Street..that's just common sense no matter what its doing at the moment.

There's several problems with SS, more people could pay into and people are just living a lot longer these days(which isn't anyones fault) but that's been a huge problem. The age is going to have to be moved up about 5 years and the cap removed.

I would not call Wall Street a casino unless you are day traiding and it is NOT a good short term plan but its return is better than what anyone my age or younger will get out of SS



I agree that the cap needs to be removed but I am not sure how much further you can push up the age (Currently at 67 I think) I think that while there are MANY jobs people can continue to do later in life there are many more that you would not want a 70 year old to be doing......That being said I think it will have to happen I just do not see another way around it at all

I still think on top of those 2 issues the Gov will need to cut benifits AND raise rates (at least until the Baby Boomer move through the system)