By standard actuarial accounting rules, Social Security has a net present value shortfall of about a gazillion dollars.
So what is this based on? I know I've read a couple of Paul Krugman columns that basically say "If you assume that the treasury bonds held by Social Security are actually worth something, we're good to go for at least 30 years on pretty conservative economic forecasts, a lot longer on more run-of-the-mill economic forecasts, and the changes needed to be good to go indefinitely even on the conservative forecasts are fairly minor" (a small increase in the retirement age to 67, and a small decrease in the rate-of-increase of benefits).
30 years is clearly not enough time to pay back everyone who's paid into Social Security, so I support making those changes, since the whole point of a safety net is to base it on the conservative predictions. But I don't see that as "a gazillion dollar shortfall" that means the whole thing is a shell game.
Are you claiming that the treasury bonds held by the SSA are actually no good, and congress has been lying when selling them to the trust fund over the years? That there's some other flaw in his numbers? Or do you just hate Krugman and think I shouldn't trust him? :-)
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winterfish
no subject
Date: 2008-09-13 04:37 am (UTC)So what is this based on? I know I've read a couple of Paul Krugman columns that basically say "If you assume that the treasury bonds held by Social Security are actually worth something, we're good to go for at least 30 years on pretty conservative economic forecasts, a lot longer on more run-of-the-mill economic forecasts, and the changes needed to be good to go indefinitely even on the conservative forecasts are fairly minor" (a small increase in the retirement age to 67, and a small decrease in the rate-of-increase of benefits).
30 years is clearly not enough time to pay back everyone who's paid into Social Security, so I support making those changes, since the whole point of a safety net is to base it on the conservative predictions. But I don't see that as "a gazillion dollar shortfall" that means the whole thing is a shell game.
Are you claiming that the treasury bonds held by the SSA are actually no good, and congress has been lying when selling them to the trust fund over the years? That there's some other flaw in his numbers? Or do you just hate Krugman and think I shouldn't trust him? :-)