Contrary to claims by cheerful news sources, Social Security’s deficit outlook is not “unchanged” or “no worse.” Social Security’s unfunded obligation rose by $1 trillion according to the latest trustees’ report.
U.S. taxpayers now owe $12.3 trillion to pay scheduled benefits—in addition to what Social Security can hope to collect from payroll taxes—over the 75-year horizon. That’s $98,517 for every household in America today.
But who can blame news sources for merely citing Treasury Secretary Jack Lew, who summarized the report in this bright light: The projections in this year’s report for Social Security are essentially unchanged from last year.
The reported unfunded obligation for the combined Social Security old age, survivors, and disability insurance (OASDI) program rose from $8.6 trillion in 2011 to $9.6 trillion in 2012. The $1 trillion increase represents a 12 percent deterioration in OASDI’s funding outlook.
“Essentially unchanged,” huh?
[The figures exclude] $2.7 trillion in IOUs owed to the Social Security trust fund, and adding it in brings the total unfunded obligation to $12.3 trillion. The entire debt held by the public is $11.9 trillion—a $1 trillion in increase in the debt limit would be no big deal then either, would it?
Social Security is in its third year of running cash-flow deficits, and the 2012 gap between revenue raised from payroll taxes and benefits paid was $55 billion. But this is merely the beginning as Social Security cash flow deficits are projected to double in less than 10 years, and continue growing from there.
Shhh... no one tell Doug Mataconis and the other leftists at Outside the Beltway! Everything's just poifect and the president is doin' a bang-up job fixin' all the economomomic problems! Hey, what time are the Kardashians on?
Hat tip: BadBlue News.