Writing for Investment News, Boston University economist Larry Kotlikoff explores the innards of the annual Social Security Trustees Report.
“Now that health care is off the front burner, it's time to fix Social Security. Social Security's trustees say the system needs only “modest changes.” In fact, the system is desperately broke.”
“The proof is buried deep in the trustees' own 2012 report in a complex table, numbered IV.B6. The system's actuaries prepare the report's tables. But what the trustees make of them is up to the trustees. Clearly this year, as in others, the trustees ignored table IV.B6. How else could they have come up with their blase statement that Congress should address Social Security's finances “in a timely way”?”
“Table IV.B6 is a long-run balance sheet for Social Security. It shows that the system's $88.9 trillion in liabilities exceed its $68.4 trillion in assets by $20.5 trillion.”
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Fix Social Security? What a joke. Talking heads and politicians have been talking about fixing social security since 1943. Now nearly 69 years later the talk about fixing social security is all the head lines.
The best fix for social security is to repeal it out right. The only way to pay people their benefits is to first tax them enough and then send them a check for what they paid in additional taxes minus the middle man. Come on folks, Bernie Maddof is in prison and the people he swindled are going to get about 80 cents on the dollar back, this is far better than those born after 1985.
Fix may be the right term. Dogs and cats get fixed, its time for Social Security to get fixed so that no one else is coerced into supporting it.
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