Tuesday, July 16, 2002
Social Security watch: I've said before that Social Security is broken. It's a simple issue of demographics -- in coming years there won't be nearly enough workers to support the growing number retirees. Many officials have set the date that Social Security stops being able to pay its obligations at sometime in the 2040s or 2050s, depending on the economy at a particular time. That date takes relies on being able to draw from the fictional "lockbox" where all of the Social Security surplus resides.
Well, since all of that surplus is held in government bonds (basically IOUs) that will have to be cashed in, we are really faced with a crisis much sooner. The current date is 2017. National Review's Jay Nordlinger points to (4th item) an interview with Dan Crippen, outgoing head of the Congressional Budget Office that appears in the National Journal (not available online).
Asked about Social Security — which, in the words of the interviewer, "starts doing a turn-around on cash flow in 2017” — Crippen says, "What happens then is the Treasury will have to raise taxes, cut other spending, or borrow from the public.”
Do we not have to worry about this impending disaster for another 50 or so years? Nope. Think 15 years. You can disagree about the push to partially privatize Social Security, but something must be done. Republicans at least recognize there is a problem. Democrats seem content to bury their heads in the sand.