With unemployment rising
the payroll tax revenue that finances Social Security benefits
for nearly 51 million retirees and other recipients
is falling
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
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…
the Treasury would have to start repaying
the billions it has borrowed from the trust fund
over the past 25 years
Recession Puts a Major Strain On Social Security Trust Fund
Washington Post, March 31, 2009
If Bernard Madoff
distributed money received from new investors to older investors
until there wasn’t enough money to continue
does Social Security operate under the same structure
with mandatory participation?
If Social Security taxes were increased in 1983
to ease the burden of a smaller generation
tasked with providing benefits to a larger number of longer living elders
why would elected leaders borrow and spend the surplus?
Illusions commend themselves to us
because they save us pain and allow us to enjoy pleasure instead
We must therefore accept it…when they...collide with a bit of reality
against which they are dashed to pieces
Sigmund Freud
No comments:
Post a Comment