Our Opinion: What about Social Security?
Friday, May 16, 2008 10:15 AM PDT
Forgive us if we haven’t been overly impressed by the current crop of presidential candidates regarding their plans for the future of key government programs like Social Security.
We’ve heard wide-sweeping proclamations on the subject of health care from the candidates. The real ghost, however, haunting our future — the viability of the Social Security system — seems to be an issue with no voice.
The statistics regarding the future of Social Security are sobering.
The Social Security system — a pay-as-you-go procedure in practice — was framed with noble motives. Taxes are collected from you and I to help cover retirement and medical costs for older folks. It is a system that has worked well.
Except now, out on the horizon, an iceberg is drifting to potentially damage our ship of state.
A large generation — the baby boomers — is set to retire. The generation is big, bigger than other generations before and after it. Which means very soon, a huge chunk of the American population is going to start dipping into the Social Security fund. At the same time, there will be fewer people paying into the Social Security system.
People are also living longer — thanks to a medical system that, while flawed, is still one of the best in the world — health care costs are climbing and Social Security benefits have expanded.
Also, the government has allocated money from the Social Security system over the years. In essence, the government has “lent” money from the system to other parts of the federal bureaucracy.
The government has scooped up money from the fund and in return issued Treasury bills for the borrowed money.
At some point the government will have to “redeem” those Treasury bills to pay benefits to those who paid into the Social Security system since they started to work.
Then only a few bad choices — such as a tax hike or cuts in expenses — will remain to keep the system afloat.
The potential disaster is not going to happen anytime soon, after all, the current Social Security system appears to be solid.
But someday, and in some fashion, the piper will call a tune, and the government will have to face the Social Security challenge.
So the real question for those seeking the nation’s highest office should not be what they can promise, or what sounds good regarding the future, but what, exactly, are they planning to do about the Social Security financial train wreck looming on the horizon?
So far no one seems to have an actual, proactive answer.
Which is the most disappointing thing of all.
