Social Security May Not Make It Another Four Years

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The problem with the long-term solvency of Social Security and Medicare is that the problems have always been long-term problems. It’s always been easier for Democrats to pander to short-term objections to tax hikes/benefits cuts, and for Republicans to pay nothing more than lip service to fixes, because the day of reckoning was always in the distant future. A time when other people would be holding elected office.

But the problem isn’t so distant now. Social Security may not be able to pay out full benefits for the next four years. Meaning Social Security could be hitting the skids before we elect another President:

As President Obama faces pressure on the left to defend federal entitlement programs from the benefit cuts that the Republicans say are necessary to keep the programs solvent decades down the road, one part of Social Security could fall short of paying out full benefits within a few years — even while Obama is still president.

Over the long term, Social Security and Medicare have promised tens of trillions of dollars more in benefits than the nation can pay for under current policies. But Social Security’s disability trust fund is in even worse shape, and current estimates say by 2016 it won’t have enough money to pay full benefits.

“That’s three years from now,” Jim Capretta of the Ethics and Public Policy Center said. “And given the president’s rhetoric and his posture, it’s quite clear that he has no intention of doing anything about it.”

The fiscal security of the disability trust fund got rapidly worse as the unemployment rate rose. The number of applications has almost doubled in the last 10 years, from 1.5 million a year in 2001 to more than 2.8 million a year in 2012.

Let’s be sure to remember that what has hastened this day was President Obama’s payroll tax cuts which weren’t renewed as part of the “fiscal cliff” deal. There has been some political blow back for Democrats as Americans, who had gotten used to lower rates of withholding, were hit with some sticker shock, but that was unavoidable given the fiscal situation the program is in. Leaving those tax cuts in place was only going to bring Social Security’s date with destiny a little bit closer (not to mention Medicare).

It doesn’t seem as though there’s any momentum for reform in Washington DC either, though that might change once we’re staring down the barrel of benefits cuts due to revenue shortages. But the “solutions” talked about most often – reductions in benefits and/or increases in payroll taxes – are not only going to be extremely unpopular with the public, their temporary fixes at best. Maybe we can change the downward trajectory of the program by a decade or two by sucking more money into the program and paying out less, but that’s kicking the can. What do we do a decade or so hence when we’re faced with the same solvency problem again?

More taxes? More cuts to benefits?

If we, as a nation, were capable of being adults about this we’d recognize that this program is a bad deal and begin an exit strategy. But if there’s one thing that’s a certainty in all this, it’s that grownups won’t be calling the shots.

Rob Port is the editor of SayAnythingBlog.com. In 2011 he was a finalist for the Watch Dog of the Year from the Sam Adams Alliance and winner of the Americans For Prosperity Award for Online Excellence. In 2013 the Washington Post named SAB one of the nation's top state-based political blogs, and named Rob one of the state's best political reporters. He writes a weekly column for several North Dakota newspapers, and also serves as a policy fellow for the North Dakota Policy Council.

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  • Roy_Bean

    The first simple, logical change has to be to adjust the retirement age to bring it in line with life expectancy today. Social security benefits should no longer start at 62. Early retirement should be raised to at least 65 and full retirement benefits should go to at least 70.

    • mickey_moussaoui

      Roy,
      obama has killed all the jobs. No one can work to 70

      • $8194357

        Point well taken.
        A nation of sheople dependtent on its masters benevolence
        was and is still the agenda, IMO…

      • SusanBeehler
        • two_amber_lamps

          http://www.npr.org/2012/02/09/146657516/study-young-people-hit-hardest-by-poor-labor-market

          Excellent! So kids can stay home into their thirties and live off their better employed parents. Interestingly those same underemployed demographic kids vote for Bamster in droves. I guess they like the status quo, as do you.

          Four more years! Wheeee!

          • SusanBeehler

            I put a link to a post and you say I like the status quo. Where did you learn to dot to dot?

          • two_amber_lamps

            We call that “connect the dots” where I’m from but maybe them thar’ skoolz in Mandan ain’t not so gud. Maybe you should administer some more tests and see?

          • SusanBeehler

            So you do have difficulty connecting the dots; dot to dot. I did not go to “skoolz” in Mandan, sounds like you may be a “cake eater”

          • two_amber_lamps

            Now you levy charges of affluence? Cake Eater? Are you a less intelligent Jean-Jacques Rousseau or are you one of those silly Occupiers who denigrate those who are capable of supporting themselves without government intervention? Yes, keep bandying about your baseless accusations Comrade…

            Take down that avatar of Reagan, you’re a pox on the face of conservatism.

        • mickey_moussaoui

          susyq,

          it is a sad statement when the only demographic that is showing signs of employment growth are the 60 plus group. The rest of the nation is flat lined. obama has 88,000,000 unemployed Americans to account for. You Democrats created this mess when you created & collapsed the housing bubble. You sent worthless derivatives around the world and crashed the global economy. Now you want a free ride from those who are left holding the bag.

          • SusanBeehler

            It is a very sad statement on the demographic growing. I agree.
            Please stopping using me as a scapegoat for the Democratic party. I am not a Democrat nor did I vote for the President. From my understanding it was created by President Clinton nor did I vote for him. So stop trying to shovel me in with your crap. There are no free rides. “You” I am not you. Mickey so find someone else to bash.

          • Hal513

            ” I am not a Democrat nor did I vote for the President.”

            You said you didn’t for Romney. Did you vote for someone else which would have been a vote for obama?

          • schreib

            Well I’m glad to hear that, because the dem party has morphed into a closer alliance with the communist party USA. Remember the old days when commies were the enemy? Clue—they still are.

      • schreib

        True, thats why we have to fight this communist at every turn

    • NDCONSERVATIVE

      Roy – There are only so many jobs. When older people work longer, these jobs are not available to other younger workers. So then the younger workers can’t find work. Furthermore there are many hard labor jobs that some older people just can’t do anymore and you want them to work longer?

      • Roy_Bean

        There may be hard labor jobs that older people can’t do but there are other jobs that they can do. What would your plan be? Socialist Insecurity can’t continue to pay out at the rate that they are now.

        In 1940 only 54% of the men and 61% of the women who reached the age of 21 could expect to live to age 65. At age 65 their remaining life expectancy was 12.4 years and 14.7 years. By 1990 72% of the men and 83% of the women who reached the age of 21 could expect to live to age 65 and still have a life expectancy of 15.3 years and 19.6 years.

        In 1940 Socialist Insecurity was designed to be paid to about 58% of the population for about 13.5 years. by 1990 the same retirement age meant that 75% of the population could expect to receive it for 17 years. The math just doesn’t work. We either have to drastically reduce the benefits or increase the age of eligibility or a combination of both.

        • NDCONSERVATIVE

          I am in your camp, but not in raising the age because of what it will do for jobs. You forgot one idea. Raise the SS tax for younger workers. They all tend to want to be socialists anyway so do that and see how they like it. Raise the SS payroll tax to 10% or whatever it takes.

          • Roy_Bean

            I don’t think that we should ever tell an able bodied person that because they have managed to live for 65 years that they are now entitled to live off the the sweat of the younger workers, and do it by confiscating 10% of the younger workers pay. Socialist Insecurity started out with the stated intent of providing food and shelter to the elderly. It wasn’t a retirement plan.

          • SusanBeehler

            So what do you want your politician to do?

          • Roy_Bean

            From my first post, above:

            Social security benefits should no longer start at 62. Early
            retirement should be raised to at least 65 and full retirement benefits
            should go to at least 70.

            I believe this should start on Feb 1, 2013, or as soon as possible after that.

        • SusanBeehler

          Maybe we should not encourage chemo for those over 80, no joint replacement after 80, no more nursing home administrators being paid more than our governor; what would you cut or change? How about stop interfering with the aging process so much unless of course you pay for it on your own? Make a medical free market? Maybe we should stop giving free transplants of livers and kidneys to alcoholics? Or if you didn’t pay in or when what you paid in runs out you don’t get anymore services. We could start grandma and grandpa support and any siblings could fight over custody. The math doesn’t work, so what politician wants to be the first to say let’s cut this?

          • Spartacus

            Nope. You’re obligated to fork over for the cost of the octogenarians hip replacement, they’ve already paid for it in the past. What you can do, though, is tell the young leeches that want to draw a check from the government without ever having paid anything substantial, if anything, into it to get a job any job to support themselves just like everyone before them did. When they get hungry enough they’ll either take the first job they’re offered or they’ll starve to death, either way the social burden they create is lighter.

          • Roy_Bean

            “What you can do, though, is tell the young leeches that want to draw a check from the government….”

            What I said in the beginning is that we need to redefine what we consider “young”. I just can’t see any reason that anyone who is not disabled should be collecting a check from Social Security before they are at least 65. Life expectancies have changed and the system hasn’t and that’s a big part of why it doesn’t work anymore.

  • mickey_moussaoui

    Justice: SS runs out on obama’s shift. There is a solution. End the growth of BigGovernment, reduce all the senseless regulations, stop the Gimmecrat war on energy, stop the obama war on business, allow people to prosper again.

    • SusanBeehler

      You are not prospering, you must not live in North Dakota, eh?

      • mickey_moussaoui

        Thanks, but don’t worry about me I have years of fiscal discipline to rest on. I made it, not the government. It’s the nation that is suffering under this perfidious charlatan named obama. We are in the midst of the worst recovery sense the great depression. This is obama’s legacy

  • Yogibare

    President Obama is not interested in adjusting or changing the benefits under what we call “entitlements”. That approach loses votes and even tho he is not up for election again, the Senators and Representatives are, and they are not wanting to fix these problems. So, it is all about raising tax revenues. We need only look at European countries to see how this works; they pay high taxes and live under a big government sponsored entitlement programs. The productive population continues to shrink, and the “takers” increase.
    The “Takers” vote and will not, as a rule, vote to cut their entitlements. Romney had it right. Our nation is at a tipping point—the next 4 to 6 years are critical—we are at a point of no return to what passes for “free enterprise”.

    • SusanBeehler

      Neither are the Republicans. Yogibare are you a “free enterprise” or are you afraid Social Security won’t be there for you?

      • two_amber_lamps

        Yep… so we’ll keep chugging down the path, make no changes to the current programs and they’ll eventually catastrophically implode or they’ll destroy the fiscal solvency of the nation.

        But you just keep pointing fingers at parties and accusing others of self interest Ms. Test Administrator (whatever that is).

        • SusanBeehler

          In case you do not get what I am saying “neither side of the aisle” is making any progress. They are doing a dance in a circle moving no where, I don’t care who makes the changes, I don’t care who gets it done, just do it. A test administrator is one who administrators those testing.

          • two_amber_lamps

            So does that mean you just pass out the sheets of paper the tests are printed on or do you actually put the tests in the bubble reader and extrapolate the results?

            It all sounds very bureaucratic to me….

          • SusanBeehler

            None of the above. It is a secure, high tech environment and has nothing to do with bureaucrats unless they take a test to be a certified bureaucrat; it is a international (means it is in other countries too) company. Where do you work graduate of the 90’s?

          • two_amber_lamps

            Whew! Good thing you explained the concept of “international” to me… no wonder you’re a vaunted “test administrator” (whatever that is).

            Where do I work? My, my… kind of a personal question you pose? Are you volunteering to become my stalker?

            There’s laws against that Ms. SuzyB. Besides, that position has already been filled by a certain greek pederast from Stockton, CA who frequents this forum.

            Request for info: DENIED.

          • SusanBeehler

            I figure you would like to have equal treatment so I could make “fun” of your job title too. Like I would be interested in stalking anyone, let alone, a white cat, pleaseeeeee! Tuesday in the ND legislature under a gun bill they reference “test administrator” maybe since you do not seem to understand what the job could possibly be; contact a North Dakota legislator and they could tell you.

          • two_amber_lamps

            Ah, so you ARE a bureaucrat! I knew you were a bureaucrat, (or a wannabe bureaucrat) you just didn’t want to admit it !!

            Yes, it all becomes clearer now!

            So anyways, perhaps you should consult your psychiatrist and have him up your medications since you seem to believe there is a conservative white cat somewhere furiously tapping his paws on a keyboard in response to your wabbling diatribes.

          • SusanBeehler

            Test administrator=one who administrators test. Was that a college degree in the 90’s? I would have thought you might have take some tests while in college or for your feline degree? What is your definition of a bureaucrat? A wannabe not hardly but it goes to show your lack of open mindedness. I have a conservative white cat I thought you were a cat lady too.

  • WOOF

    The rights glee in exploiting the elderly and disabled
    strengthens the left . Another Barack opportunity for
    voter block consolidation.
    Don’t ya just know it
    Ah ha ha ha.

    • Hal513

      Hey woof…where’s are those “stripped resources?”

      Continue on…You moron.

    • splined

      “The problem with socialism is that you eventually run out of other people’s money. ”
      ― Margaret Thatcher

    • silverstreak

      Is it exploiting the elderly and disabled by pointing out to them that the government lied to all of us.That politicians on both sides of the aisle have spent all the money in the Social Security Trust Fund on everything from aircraft carriers to paper clips. That in fact there is nothing in the trust fund but a bunch of worthless I.O.U.s. and politicians continue to lie.
      Simply flasback to the debt ceiling fight in 2011.

      http://townhall.com/columnists/walterewilliams/2011/10/05/social_security_disaster/page/full/
      Excerpt

      Some politicians claim that Social Security has a huge trust fund and is in good health. An uniformed public and a derelict news media don’t challenge that lie. Back in August, politicians were in a tizzy over raising the federal debt limit. In an effort to frighten seniors, President Barack Obama said in a CBS interview, “I cannot guarantee that those checks go out on Aug. 3 if we haven’t resolved this issue, because there may simply not be the money in the coffers to do it.” Here’s how we reveal the trust fund lie: According to the Social Security Administration, it has a trust fund with $2.6 trillion in it. If those were real assets, then the Social Security Administration could have mailed checks out regardless of what Congress did about the debt limit. The reality is that the Social Security trust fund consists of government IOUs that have no real value at all and probably are not even worth the paper upon which they are printed.
      It may not be what they want to hear but welcome to the real world!

      I know that I’m not all that thrilled since the government has been snatching money out of my paycheck for over 40 years so far.

    • schreib

      You must have not truly gotten a grasp of this article. WE are BROKE. We are on a train going 80 miles an hour, the bridge is washed out and the train has no brakes. We need to REFORM SS to insure that it is around for generations to come. Get with the program. Get your head out of the sand

      • WOOF

        Raise the income cap from 106 K , order a Scotch in the club car. Get off the train and visit Grandma’s house with the check.

        • Hal513

          Everyone is still waiting to hear from you regarding all the resources that we “stripped” from Iraq.

        • schreib

          Oh Woofie. Grandma is in Arizona, and I am 55 and will probably work til I croak because I can’t afford to retire. We can’t pay for ss or medicare and the Odipshit proposes Obooboobcare that we don’t have the money for either. I absolutely refuse to live under Obamao’s communism.

  • $8194357

    Yes they sold this suger coated poison pill to a gullible America huh.
    I’m from the government and I’m here to help,lies with a statist totalitarian agenda..

  • schreib

    Obama is going by the Cloward-Piven play book. Totally crash the system in order to build up a communist utopia————–communist Butthead

    • $8194357

      Yup…
      That is what it is no matter what they call it.
      All of DC has got the disiese in my opinion.

  • schreib

    Sen Paul Ryan was right. It is too bad The American people didn’t see the truth. They only wanted to listen to Odipshit Obama and his “everything is rosy” diatribe.

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