Jed Graham, writing for Investors Business Daily, discusses new Congressional Budget Office projection showing a worsening financial outlook for Social Security:
“Social Security's financial outlook took another hit this week, as the Congressional Budget Office hiked its estimate for cash deficits from 2013 to 2022 by $212 billion.”
“The wider deficits — mainly due to weaker revenue estimates — mean a quicker depletion of Social Security's trust fund, after which the program could only afford to pay about 75% of benefits.”
Read the whole story here.
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The “Sacred Cow” is dying as we watch. Truly amazing, reminds me of the mid 70’s when Social Security’s OASI program was running continual negative cash flows from 1971 to 1983. Congress attempted to slow the increasing yearly negative cash flows by large tax and base increases, but all was in vain when in 1983 the OASI trust fund was actually exhausted. Had it not been for authority to borrow $11 Billion from the Medicare and SS-DI trust funds, OASI would have been unable to pay full scheduled benefits in the last part of 1983.
Now 30 years later we are watching a repeat. But wait, this is not the second repeat. The first began in 1947 and became critical in 1950 when Congress increased the payroll tax and base by 50% and began enrolling the “undesirable” workers not covered by Social Security because of low wage or inconsistent wages.
What do investors say; the trend is your friend? Look at the chart.
How many workers truly believe that payroll taxes are a benefit? What type of retirement security could you as a worker provide yourself and family if you could control the 10.6% OASI payroll tax? Race to the bottom and workers think they have no way to get off this train wreck. So sad the hard work of millions of workers being wasted and all the time hoping congress will implant some amazing fix that miraculously fixes the program. If you believe in congress or some other entity fixing social security without pain, then you still believe in the tooth fairy, Santa and the ester bunny.
When Ponzi Schemes finally crash, nearly all involved are decimated.
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