October 09, 2003
NOW YOU'RE TALKIN':
It's Even Worse Than You Think (HOWELL E. JACKSON, 10/09/03, NY Times)
Were the federal government to account for its Social Security obligations under the rules of accrual accounting, which govern public companies, its financial outlook would be far worse. By the end of last year, the Social Security system owed retirees and current workers benefits valued at $14 trillion. The system's assets, in contrast, were only $3.5 trillion. These assets include not only the trust funds' current reserves ($1.4 trillion), but also the present value of the taxes that current workers will pay over the remainder of their working lives ($2.1 trillion).In other words, the system's current shortfall -- its assets minus its liabilities -- is $10.5 trillion. Unless Congress chooses to rescind Social Security benefits that have already been earned, this shortfall must be shouldered by future generations.
As we've just seen in California, the one thing that can galvanize Americans into action, even revolutionary action, is an unreasonable tax burden. The notion that twenty or thirty years from now the young -- who by definition will have no stake in the Social Security system -- will be content to fund it, seems awfully naive. Posted by Orrin Judd at October 9, 2003 10:09 PM
Do you mean to say that the Social Security system as originally sold to the American people is a fraud? Shocking.
Posted by: Tom C., Stamford,Ct. at October 10, 2003 11:51 AMGalvanize is the right word: when the choice is between a 10% SS tax (which would really be 20%) and serious overhaul, not even Claude Pepper would have staked his political future on the losing side.
But for the Repubs. to build on it, they have to learn how to bring awareness to an ignorant public. This may be Bush's great task, even more so than his response to 9/11. Should he choose to campaign on it next year (with an expanding economy), the Dems. would be perpetually another step behind.
Posted by: jim hamlen at October 10, 2003 02:34 PM