In its annual report the trustees of the Social Security Trust Fund announced that "pension and disability payments will exceed revenues for this year and 2011, reflecting the deep recession." Predictably, politicians who want to get rid of the program immediately pounced, saying the retirement age should be raised to 70 (it went from 65 to 66 last year; did you know that?).
So why are payouts higher than revenues?
More people filed for Social Security in 2009 — 2.74 million — than any year in history, and there was a marked increase in the number receiving reduced benefits because they filed ahead of their full retirement age.Ah. People file for Social Security at 62 rather than 66, thus increasing demand on the fund. At the same time, 9.5% of the population is unemployed and thus not paying into the fund. Ergo, more outgo than income.
Don't believe the politicians who tell you the sky is falling because of this shortfall; it's temporary. If more people were employed the fund wouldn't be in this condition.
Posted by Linkmeister at August 9, 2010 08:03 AM | TrackBackThe first job of Congress right now should be getting Americans back to work. But how many congressional Repulicans actually want to see that happen, or see the economy improve? Any such thing would be seen as a success for the Obama administration and/or the Democratic congressional majority. The wave of anti-incumbency, anti-those-in-charge would not be served by such a positive outcome. A bad economy and bad jobs outlook during a Democratic administration can be translated into additional votes for Republicans. Why would any congressional Republicans want to mess up a good thing?
Posted by: Harold at August 9, 2010 11:10 AM