A few days ago, I was involved in a conversation with a leftist supporter of the Federal government’s venerable Social Security program. My position was the program is a Ponzi scheme and for all intents and purposes, it is insolvent.
The person I was speaking to, an ill-informed statist, was aghast that someone would question our Federal Government!
To be more specific about my concern, I went to paraphrase the Social Security Trustee report stating that even its caretakers know the program is failing as evidenced below.
“Social Security’s total income is projected to exceed its total cost through 2019, as it has since 1982. The 2015 surplus of total income relative to cost was $23 billion. However, when interest income is excluded, Social Security’s cost is projected to exceed its non-interest income throughout the projection period, as it has since 2010. The Trustees project that this annual non-interest deficit will average about $69 billion between 2016 and 2019. It will then rise steeply as income growth slows to its sustainable trend rate as the economic recovery is complete while the number of beneficiaries continues to grow at a substantially faster rate than the number of covered workers.
After 2019, interest income and redemption of trust fund asset reserves from the General Fund of the Treasury will provide the resources needed to offset Social Security’s annual deficits until 2034, when the reserves will be depleted. Thereafter, scheduled tax income is projected to be sufficient to pay about three-quarters of scheduled benefits through the end of the projection period in 2090. The ratio of reserves to one year’s projected cost (the combined trust fund ratio) peaked in 2008, declined through 2015, and is expected to decline steadily until the trust funds are depleted in 2034″.1
To close my conversation, I put the statist on the spot by promoting privatization and further pondering just how much worse could we, as individual citizens, do in planning for our own retirement than is currently being done by the Federal Government?
As no surprise, the statist could not respond.
A SUMMARY OF THE 2016 ANNUAL REPORTS. Rep. Social Security and Medicare Boards of Trustees, 22 June 2016. Web. 11 Feb. 2017.