Social Security is broke
Bernard Madoff is now rotting in prison after pulling off one of the greatest private Ponzi schemes of all times. But like all Ponzi schemes--taking Peter's money to pay off Paul--Peter ran out of money and Madoff had to give up. Or as England's former Prime Minister Margaret Thatcher noted, "The trouble with socialism is that eventually you run out of other people's money."
And now Social Security, the American government Ponzi scheme that makes Madoff's look like a game of Monopoly, is, as Kevin Williamson of NRO explains "officially broke."
Analyzing the figures from the non partisan, and usually quite accurate Congressional Budget Office, Williamson notes
[I]f you think that borrowing another $1 trillion from the bond market to shift money from one government account to another government account makes the nation $1 trillion richer, then everything's hunky-dory. But if you compare the program's tax income to its benefit outlays, without the "interest" owed, as CBO does, what you get is deficits from this year forward to 2021 of $45 billion, $30 billion, $28 billion, $30 billion, $31 billion, $33 billion, $44 billion, $59 billion, $77 billion, $98 billion, and $118 billion - by my always-suspect English-major math, about six-tenths of a trillion dollars in the hole.
Sixty years ago there were about 16.5 workers for every Social Security beneficiary; today the figure is a little over three; in just 11 years, 2030, around two workers will be supporting one retired worker.
To do that will require ever higher taxes. But
President Obama has explicitly rejected the recommendations of his own bipartisan deficit panel, specifically the proposal to raise the Social Security retirement age modestly over the course of several decades (to 69 by 2075). But we can only put so many trillions on the national balance sheet before our national chit gets called in, at which point it will hit the fiscal fan.
Social Security is commonly referred to the third rail of American politics; touch it by trying to fix it, you die. But when the Social Security chit and others finally hit the fiscal fan, as Williamson puts it, the first and second rails of society will be as deadly as the third one. Greece, Portugal, Ireland are mere previews.
The golden years will be dross.
If Madoff and other Ponzi crooks are imprisoned for their illegal schemes why not the architects of Social Security and all the other wealth distributionists?