A quote from Michael J. Astrue, Commissioner of Social Security seems to say it all:
This year’s Trustees Report contains troubling, but not unexpected, projections about Social Security’s finances. It once again emphasizes that Congress needs to act to ensure the long-term solvency of this important program, and needs to act within four years to avoid automatic cuts to people receiving disability benefits.
Particularly troubling facts:
The combined assets of the Old-Age and Survivors Insurance, and Disability Insurance Trust Funds (OASDI), what we commonly call Social Security benefits, will be exhausted in 2033.
The Disability Insurance trust fund will be exhausted by 2016.
2010 was the first year since 1983 that there was not sufficient non-interest income to cover program costs. Projections calculated by the Social Security administration office show that this trend will continue through the entire 75 year long-range period.
In 2011 the OASDI trust funds paid out a total of $736 billion in benefits and fees to administer the fund. Of this amount, $725 Billion was paid in Social Security benefits to an estimated 55 million beneficiaries.
To cover the short-fall and fully fund the OASDI over the entire 75 year long-range period would require $8.6 trillion in present value dollars (or 2.27 times the entire government budget for 2012).
Social Security as it is currently structured is dying a slow death. Major reforms are needed to solve not only the solvency issue, but also reform the system for the long term. Congressional action is the only recourse to provide stability to this system, however Congress men and women who are more interested in their own Congressional seats have some incentive to leave hard decisions up to someone else. One fact seems to be clear; the current Social Security system is in peril. When will it be fixed? Who will fix it? Is it a system that can be fixed? I guess not enough people care, otherwise it would be bigger news; at least the news covers weather a minimum of three times every half hour, so we will know whether it is going to rain tomorrow.