What's really going on with Social Security
Is Social Security really "exhausted"? Not at all.
- My column today at Reuters explains why so much mainstream media coverage is off the mark and needlessly scaring Americans about Social Security's financial condition.
- Here's video of the Trustee press briefing: skip to 14:50 to hear SSA Commissioner Michael Astrue's remarkable plea with the press not to scare the public unduly about Social Security running out of money:
"Please, please remember that exhaustion is an actuarial term of art and it does not mean there will be no money left to pay any benefits.
After 2033, even if Congress does nothing, there will still be sufficient assets (from payroll taxes) to pay about 75 percent of benefits. That's not acceptable, but it's still a fact that there will still be substantial assets there."
- Full report of the Trustees. Especially interesting information on the following pages:
27: By law, the Department of the Treasury must invest trust fund assets in interest-bearing securities backed by the full faith and credit of the United StatesGovernment. Those securities currently held by the OASI Trust Fund arespecial issues, that is, securities sold only to the trust funds. These specialissues are of two types: short-term certificates of indebtedness and longer term bonds.
Also see Table VI.B1.—Long-Range OASDI Actuarial Balances and Trust Fund Exhaustion Dates (page 158), which shows fluctuations of the exhaustion date over time due to economic cycles.
- Jared Bernstein makes the same point here about the fluctuations of the trust fund exhaustion dates.
- Nancy Altman of Social Security Works appeared on PBS NewsHour along with David Johns of Heritage Foundation.
- Trudy Lieberman of CJR on how media covered this story:
- Earlier coverage by Trudy on the media coverage.
- Michael Hiltzik of the LA Times on why we should be increasing benefits, not cutting. I agree.
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