Today the New York Times had a shocking story: this year the Social Security Trust Fund will pay more out in benefits than it takes in in revenue. There are several reasons this is an important story.
First, it is important because it reminds us that our country is on the edge of a fiscal precipice. The baby boomers will begin retiring next year. Indeed, with the recession some have started to retire early. As the story notes, “payments have risen more than expected during the downturn, because jobs disappeared and people applied for benefits sooner than they had planned.”
Congress added to this crisis this week by passing ObamaCare. The left has argued that we can afford this $1 trillion spending program because, with the taxes, it will actually reduce the deficit. That’s what CBO says!
But, and this is the second point, CBO got Social Security wrong. They didn’t see this coming. From NYT:
This year, the system will pay out more in benefits than it receives in payroll taxes, an important threshold it was not expected to cross until at least 2016, according to the .
Just at the moment that we our entrusting our countries fiscal future on guestimates on the health care bills from CBO, it turns out that they completely failed us on Social Security.
Just something to keep in mind.