Social Security is getting less secure

Pundits and forecasters of doom and gloom are saying Social Security is going to run entirely out of cash for a while. This year is going to be a mark in favor of that viewpoint. The Social Security Administration is going to spend more than it takes in. This is not the very first time Social Security has run in the red, either. The 1980s saw similar trouble with the SSA. There is a trust fund that Social Security puts the additional money into, which is how they’ll cover the loss.

Income far exceeds Social Security

This year, according to the Los Angeles Times, the Social Security Administration will spend more than it will earn. The board of trustees for Social Security and Medicare have reported, as of August 5, the tax income could be less than their due to fork out out by the end of 2010. After the new health care reform bill passed, Medicare was expected to stay solvent until 2029. Medicare had previously been estimated to lapse into critical condition by 2017. More incentives and regulations are expected to stave off Medicare’s impending demise.

Social Security is a trust fund baby

There is a trust fund that Social Security has just in case. Anything left over after expenditures gets put in the trust fund. Any shortfalls that occur are covered by the trust fund. That’s why it was created. According to the New York Times, the Social Security Trust Fund is not in danger of running out until 2037. The Social Security Administration will still be able to make 75 percent of its payments if the numbers are accurate, according to the Social Security commissioner Michael Astrue.

Who’ll be Peter with so numerous Paul’s?

Tax revenues are how Social Security is funded. If less cash is being earned by people working, less cash is accessible for the program. More cash has to be paid out as individuals live longer and longer lives. This particular Social Security shortfall won’t affect people’s benefits, but the next one might.

Additional reading

nytimes.com/2010/08/06/us/politics/06benefits.html

latimes.com/news/nationworld/nation/wire/sc-dc-0806-social-security-20100805,0,6306255.story