The Committee for a Responsible Federal Budget released their estimates of the effects on Social Security’s financing of the reform plan released yesterday by Gov. Jeb Bush. Overall, the CRFB estimates are very close to the figures contained in an analysis I released yesterday.
What we both find is that the Bush plan could be expected to eliminate Social Security’s 75-year actuarial deficit and to produce a small trust fund surplus at the end of 75 years. Where we differ is that the CRFB analysis finds that, despite the program being solvent over the long term, the Social Security trust fund would go through a period of insolvency that would require that the trust fund be granted the authority to borrow. That borrowing would be repaid by the end of 75 years. In my analysis, the trust fund remained solvent throughout the 75 year period.
The differences are likely due to small details of how we set up the provisions to be simulated. But again, both analyses show a similar picture: that the Bush proposal would substantially improve the long-term solvency of Social Security.Read more!