We’ve finally “stopped the raid” on Social Security…

For years, politicians and members of the public have decried the so-called "raid" on the Social Security trust fund, in which surpluses generated by Social Security were spent on other programs. For instance, back in 1990, Sen. Harry Reid asked, "Are we as a country violating a trust by spending Social Security trust fund monies for some purpose other than for which they were intended? The obvious answer is yes."

Now, there was nothing illegal about this practice; since Social Security was required by law to invest it surpluses in Treasury securities that pretty much means the Treasury was required to borrow the money. That said, Sen. Reid assured us, as a lawyer, that someone doing this outside of government would be prosecuted.

More importantly, there's good reason to believe that borrowing from Social Security encouraged the rest of the government to spend more and tax less than it otherwise would have, since the deficits and debt involved were effectively "off the books." The Social Security trust fund still has meaning in an accounting sense, but it doesn't represent any true saving in a budget-wide or economy-wide sense.

Personal accounts were proposed as one means of "saving the surplus," though they ran into problems when it became clear that a lot of people – both in Washington and elsewhere – didn't particularly want the surplus to be saved. They liked their spending higher and taxes lower. Former Vice President Gore proposed the much-derided "lock box" to save the surplus, although even to Social Security specialists it was never quite clear how that would work. Seemingly, the Social Security raid was an unsolvable problem.

But some problems solve themselves. According to the Congressional Budget Office's most recent projections, released this week, Social Security is running cash deficits and will continue running cash deficits, well, pretty much forever. Last year, both CBO and the Social Security Trustees projected that Social Security – while currently running deficits due to the recession – would return to surpluses again for several years before making a final turn South in 2016. The new projections show deficits every year from 2011 through 2021, totaling $593 billion over that period.

So breathe easy, America, the "raid" on Social Security has finally been stopped. Now we just need to think about repaying the trust fund and making the rest of the program sound. But all we heard from President Obama on that subject in the State of the Union address was the sound of a ball being punted.