Picture, kiloword, we know the drill. So here they are.
First, here's a CBO graph of the known and projected budget deficit from a few years ago. Take a glance at the spread in the uncertainty over just 5 years in the future and realize why projections of anything more than 10 years in the future involving economics the size of the United States, including Social Security, should be taken with a grain of salt the size of Gomorrah:
Uncertainty is enormous in this line of work. For instance, back in the mid-90's they were saying Social Security would be going bankrupt in 2029. If we continue to gain 13 years of strength every 10 years, that would mean we'd be solvent indefinitely. (Current projections of Social Security at any given time usually are relying on pretty pessimistic assumptions, so that's not unreasonable.)
Having said that, and even if we do cautiously take projections that far ahead as a rule of thumb, take a look at this one from 2002:
(I'm pretty sure that dark blue strip in the middle with the triangle is actually Medicaid.)
You really want to take action now to make sure the government has the ability to pay its obligations in 2042 and beyond? Take a look at this graph and tell me what our biggest problem is going to be. Social Security? As a percentage of GDP, it's practically flat. If you want to keep costs from ballooning, hold down the debt! Keep deficits from piling up interest for our children and grandchildren to pay, see that taxes are enough to cover expenditures, and for Pete's sake don't take on another couple of trillion in debt to finance privatizing Social Security as a solution to a problem that doesn't exist. Want to look at a domestic program whose costs will be growing rapidly? Fine, Medicare's your row to hoe.
Senator Rick Santorum came to my University recently and showed us a graph roughly like this second one in a presentation whose content was largely devoted to thirty minutes of "there is a crisis in Social Security, really, honestly" and five minutes of "wouldn't private accounts be great?". He was flipping through factoids too rapidly to really let any of them be chewed over, but when he showed us this graph even a moment's inspection made this same fact clear -- the big budget problem we are now leaving for future generations isn't Social Security, it's the debt we're piling up for them to pay.
Posted by William at March 3, 2005 09:56 PM
What's also notable about that first graph is that the actual budget deficit for 2003 and 2004 falls outside the projection. I guess they didn't take Bush's tax cut and war plans into account for even the worst estimate.
since imgs are stripped, this is a link
Sources:
http://money.cnn.com/2001/10/29/economy/budget/
http://www.ombwatch.org/article/articleview/1168/1/154/
http://www.cbpp.org/10-14-04bud.htm
As for that second picture, what is with the interest costs as proportion of GNP disappearing about 2010 and reappearing with a vengeance in 2030? I doubt that's an accurate projection, or perhaps they were still assuming that President Gore would follow through on his promise to pay down the debt. I also have to wonder where the giant leap in medical costs comes from. Was coverage greatly increased, or is that all from the Baby Boom generation growing old and needing additional care? Interesting things to think about.
