Crisis!!!1!!!

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!


Recession Puts a Major Strain On Social Security Trust Fund
As Payroll Tax Revenue Falls, So Does Surplus

By Lori Montgomery
Washington Post Staff Writer
Tuesday, March 31, 2009; A04

The U.S. recession is wreaking havoc on yet another front: the Social Security trust fund.

With unemployment rising, the payroll tax revenue that finances Social Security benefits for nearly 51 million retirees and other recipients is falling, according to a report from the Congressional Budget Office. As a result, the trust fund's annual surplus is forecast to all but vanish next year -- nearly a decade ahead of schedule -- and deprive the government of billions of dollars it had been counting on to help balance the nation's books.

While the new numbers will not affect payments to current Social Security recipients, experts say, the disappearing surplus could have considerable implications for the government's already grim financial situation.

The Treasury Department has for decades borrowed money from the Social Security trust fund to finance government operations. If it is no longer able to do so, it could be forced to borrow an additional $700 billion over the next decade from China, Japan and other investors. And at some point, perhaps as early as 2017, according to the CBO, the Treasury would have to start repaying the billions it has borrowed from the trust fund over the past 25 years, driving the nation further into debt or forcing Congress to raise taxes.

Heaven forbid we'd have to stop raiding the Social Security fund.

Tags: Social Security (all tags)

Comments

3 Comments

Re: Crisis!!!1!!!

I just got my annual social security newsletter.  It contained the same politically motivated editorial full of ALARM about the insolvency of the system that it has every year I've cared to read the thing.  But this year, bundled in the envelope was a hastily printed bonus page(lower quality paper, not bound with the rest of the newsletter, et c.) with a second editorial calming fears and referencing a completely different (and more honest) set of statistics about social security.  Change is on the march!

by Endymion 2009-03-31 08:58AM | 0 recs
Re: Crisis!!!1!!!

$700 Billion?  Where have I heard that number before?

Now, I remember...

by KimPossible 2009-03-31 09:07AM | 0 recs
So, it won't be solvent until 2037, last year's es

estimated date that it would no longer be able to pay all its benefits by.

2037

...

by architek 2009-03-31 04:54PM | 0 recs

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