In today’s New York Times, researchers Gary King and Samir Soneji have an op-ed describing their new finding that the Social Security crisis is actually much worse than thought. They explain:
For the first time in more than a quarter-century, Social Security ran a deficit in 2010: It spent $49 billion dollars more in benefits than it received in revenues, and drew from its trust funds to cover the shortfall. Those funds — a $2.7 trillion buffer built in anticipation of retiring baby boomers — will be exhausted by 2033, the government currently projects.
Those facts are widely known. What’s not is that the Social Security Administration underestimates how long Americans will live and how much the trust funds will need to pay out — to the tune of $800 billion by 2031, more than the current annual defense budget — and that the trust funds will run out, if nothing is done, two years earlier than the government has predicted.
Of course, in reality, the so-called trust fund is a myth, because ultimately all government spending is going to be paid out of the same bank account anyway. In a November column, I described why, despite liberal claims, Social Security is a contributor to the deficit.