What we were told for years wouldn't be a reality until 2018 or 2015 at the earliest is now an honest to goodness reality: Social Security is running a deficit. Yaaayy!
The bursting of the real estate bubble and the ensuing recession have hurt 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.
Yeah, let's not actually worry about the systemic fatal flaws in Social Security because everyone will be getting their checks as usual. Nothing to see hear - please move along.
Informal poll question that you can answer in the comments: Would you give up your social security benefits (despite all the years you paid into it) in return for, effective immediately, dropping the 6% Social Security tax (FICA) on your paycheck and dropping a portion of the 6% payroll tax your employer pays to the system (this precise amount can be negotiated - we're open to suggestions!)?
Bottom line: A 6-9% payraise in exchange for walking away from the system. We totally understand those of you approaching retirement who would balk at this but we would jump at this opportunity in a heart beat.
Not that anything is actually going to get done to solve this crisis. Bush's modest proposal for the option of privatizing up to 10% of your Social Security account was met with such outrageous howls of protest back in '05, we can't imagine anyone possessing the nerve to do anything now.... except to throw more money at it or paper over the deficit with gimmicks.
Think it was Dennis Prager that said: "Religion is not the opiate of the masses, entitlements are."
Shameless plug of the day: Get ye over to Doo Doo Economics to gear up for the coming battles. To quote Mark Knopfler of Dire Straights: "Badges, posters, stickers and t-shirts."
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4 comments:
I would love the 6-9% pay raise but I am hesitant to walk away from a fund I have been paying into for all of my working life without getting a penny out of it. The raise would be great but how about adding some sort of severance payout too!
So here's the question that is developing, but I don't hear being asked.
Historically, large numbers of Treasuries have been bought by Social Security, China and Japan, all of whom are now net sellers. Where is the future demand for the things going to come from?
If you were Home Depot and local contractors stopped buying from your stores, you'd have to make up the demand somewhere else. Well, that's what's going on here. This is why I'm a bit detached from the health care debate. Mathematics is inexorably propelling us towards an endgame that speeches and votes cannot avert.
Seeing as I'll never get anything out of it no matter if I pay in or not, sounds like a winner to me.
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