Chart of the Day

UPDATE: below

From the National Review (subscription only):


source: May 25th National Review on dead tree at 6
But even this underestimates the problem, as Kevin Hassett explains:

The problem is, the assumptions that give us that scenario are far more optimistic than the assumptions required to justify, say, a $787 billion stimulus package. Indeed, the chart is almost comical in its miraculous ability to skirt negative territory. In reality, Social Security will almost surely have a deficit this year. Such a deficit requires urgent reform.

Back in 1981, the National Commission on Social Security Reform -- more commonly known as the Greenspan Commission, after its chairman -- was established because Social Security was borrowing money from Medicare to pay out monthly benefits. The crisis atmosphere motivated action. After considering a number of proposals, the commission suggested increasing Social Security taxes and gradually raising the retirement age from 65 to 67. These recommendations were enacted in the 1983 Social Security Amendments Act, along with a few other fixes.

But fixing Social Security now would get in the way of imposing card check, hiking taxes on corporations, and "reforming" health care this year. So Democrats are ignoring the problem.

As government looks for excuses to undercut free markets, it seems to be able to find a crisis everywhere it looks. Except for where the crisis is.

The latest Democrat blind spot is the just-released annual Social Security trustee report. The bottom line: under "intermediate" assumptions, the system goes broke in 2037 (page 56), "four years earlier than predicted," as the NY Times acknowledges. Compare that with Senate Democratic Leader Harry Reid's reaction to the 2005 trustee report:

Today's report confirms that the so-called Social Security crisis exists in only one place -- the minds of Republicans. In reality, the program is on solid ground for decades to come.

Reid's still right if the set 'decades' = {1, 2}.

MORE:

Economist Bruce Bartlett in Forbes magazine:

[T]axpayers are on the hook for Social Security and Medicare by these amounts: Social Security, 1.3% of GDP; Medicare part A, 2.8% of GDP; Medicare part B, 2.8% of GDP; and Medicare part D, 1.2% of GDP. This adds up to 8.1% of GDP. Thus federal income taxes for every taxpayer would have to rise by roughly 81% to pay all of the benefits promised by these programs under current law over and above the payroll tax.