They say the only things you can count on in life are death and taxes. When it comes to Social Security, the future isn’t much different. Social Security has taken the first steps on the road to its ruin:
This year, the system will pay out more in benefits than it receives in payroll taxes, an important threshold it was not expected to cross until at least 2016, according to the Congressional Budget Office.
Stephen C. Goss, chief actuary of the Social Security Administration, said that while the Congressional projection would probably be borne out, the change would have no effect on benefits in 2010 and retirees would keep receiving their checks as usual.
The problem, he said, is that payments have risen more than expected during the downturn, because jobs disappeared and people applied for benefits sooner than they had planned. At the same time, the program’s revenue has fallen sharply, because there are fewer paychecks to tax. [Emphasis added]
via Social Security Payout to Exceed Revenue This Year – NYTimes.com.
As Social Security marches into the red, there are only two possible solutions. Kill the program, or raise taxes to cover the increase in payouts. The only questions are which congress will pick, and when it will pick it.
The ball is in Congress’ hands, and the shot clock is ticking. Either way, taxpayers are going to the be the ones getting upset.
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