(IBD) Social Security A Big Deficit Driver

Posted by Kendall Harmon

The Congressional Budget Office projects that over the next decade Social Security's annual cash deficit will rise by nearly $100 billion, reaching $155 billion a year. The cost of servicing the extra public debt tied to cashing in $1 trillion worth of Social Security's intragovernmental IOUs over the 10 years would add $40 billion to the deficit in 2022 alone, an IBD analysis finds.

Overall, Social Security would account for nearly $200 billion in annual deficits or nearly 20% of the $1 trillion-plus deficit that would occur under current policies, including fiscal-cliff tax hikes.

Then, over the following decade, the retirement program's impact on deficits would really balloon.

Read it all.

Filed under: * Culture-WatchAging / the ElderlyHistory* Economics, PoliticsEconomyThe U.S. GovernmentBudgetSocial SecurityThe National DeficitPolitics in GeneralHouse of RepresentativesOffice of the PresidentPresident Barack ObamaSenate

Posted January 14, 2013 at 7:30 am [Printer Friendly] [Print w/ comments]

1. Marie Blocher wrote:

Ever since Reagan brought it “on budget” for that express purpose, Social Security has been hiding the governments overspending.
To blame it for the extra interest for money to pay SS back all the money borrowed from it over the years is
like blaming Uncle Joe for your gross overspending because he lent you $100 last year.
And since the government has been paying interest for years on all those IOUs that SSA holds, what is the difference in paying SSA interest and paying some other bondholder interest? Interest is interest expense regardless of to whom it is paid.
The other bondholders have a choice of where to lend their money and thus probably require a higher interest rate than SSA which has no option in where it can place its money.
But I guess if we can blame banks for lending us mortgage money to buy a house we couldn’t afford, that is now worth less than we paid for it, then we can blame SS for lending us money to spend foolishly.

January 14, 11:28 am | [comment link]
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