The Ghost of Christmas Past

In all the hoopla/wailing and gnashing of teeth over ObamaCare, it would have been easy to miss this news -- Social Security is now paying out more than it is taking in:

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.

Analysts have long tried to predict the year when Social Security would pay out more than it took in because they view it as a tipping point — the first step of a long, slow march to insolvency, unless Congress strengthens the program’s finances.

We've known that this moment was going to come and we've known it for rather a long time. The demographic problem in this nation has been evident for at least 25 years, when it became clear that the Baby Boomers were not going to have enough children to keep paying the freight. We've continued to kick the can down the road; while George W. Bush made an effort to reform Social Security in 2005, he got shot down pretty fast, mostly by the people who are now at the helm. Consider the words of Nancy Pelosi, in her 2005 "prebuttal" to President Bush's State of the Union address:

The President talks about a crisis, but according to the nonpartisan Congressional Budget Office, Social Security will be solvent for nearly 50 years.

This was a common thread back then. I remember well having discussions/arguments with one of my liberal co-workers about this. He insisted that Social Security was doing just fine and that there was nothing to worry about -- he tended to take Talking Points Memo literally in those days -- every argument that Joshua Micah Marshall made in TPM back then hurtled through the cubicles of our Bloomington offices. My co-worker, TPM and Mrs. Pelosi won the day and Bush retreated from his plans.

Now we are 5 years on and the day of reckoning is beginning to approach. We have this week added another entitlement with costs that will explode into the trillions. We pile this on the costs imposed through Bush's greatest mistake, Medicare Part D, Medicare itself and the grossly underfunded public pension system.

It is my assumption that the Baby Boomers won't willingly sign up to be Soylent Green; if they follow their normal pattern, they will be clawing for every penny that was ever promised to them. I'm part of that demographic (born 1963), but most people my age don't assume that we will see much from Social Security; we've watched our generational big brothers and sisters long enough to see that they'll take what they can get and won't worry much about the rest of us.

Like me, Barack Obama is part of the late Boomer set (born 1961, in Hawaii I might add). He's seen the same things I've seen and has decided to kick the Social Security can down the road, too, as well as throwing his new load on our shoulders. I honestly wonder how we're going to pay for all this largesse. More importantly, who is going to pay for it? Somehow, I don't think Benster or Fearless Maria will be too keen about ponying up half their income to support my generation in our dotage.