So, I was just running some back-of-the-envelope calculations tonight.
80 million baby boomers retiring over next ~18 years starting 2011.
Avg. Social Security paycheck according to 2001 Census: $1051
80million*$1000/month is $80,000,000,000/month ($80billion/month)
Currently 131million US workers.
That's $7000/worker, per year.
Robbing your children: PRICELESS.
Before someone makes one of those "spend less on wars" comments,
Total cost of Iraq War these last 9 years has been ~$700B
Our yearly interest payment is >50% of the total cost of the Iraq war.
Total spent on wars since 2001-- ~<$1T
Our yearly expenditure for 80m baby boomers will be >$1T PER YEAR.
So "not doing the wars" wouldn't help us much [any].
also, August 2008 CBO Social Security stats-- notice how the crossover point isn't until like...2020.... http://www.cbo.gov/ftpdocs/96xx/doc9649/08-20-SocialSecurityUpdate.pdf
and where is it now? daayyyum we just crossed it!!! August 2009-- http://www.cbo.gov/ftpdocs/104xx/doc10457/08-07-SocialSecurity_Update.pdf
Outlays will probably stay above revenues (in contradiction with the CBO estimates) because, I believe, the CBO estimates are assuming a return to economic growth this year (which I have decent reservations about* but I may be wrong).
The shock from the trend up, in outlays, to the Federal Deficit, is double because of Unified Accounting (which we returned to under Nixon)-- UA lets us take that extra 1% we were raking in, and reinvest it in Treasury bonds, and take that value off the official Federal Deficit numbers. So, when the outlays trend up, we're both spending more on the actual Social Security checks, and can't pad our deficit levels with the extra 1%. Hence the double effect on the deficit.
Who knows maybe they can just gradually decrease SS benefits to old people. But then they'll have to sell off more of their stocks/assets (like houses), depressing economic activity...
(*reservations: http://2.bp.blogspot.com/_nSTO-vZpS...s/xahZhsGWJzg/s1600-h/illinois+budget+gap.jpg -- states going to have to cut back on their spending a lot. Aside from the guy mislabeling KY, lol, I believe those numbers check out.)
TL;DR version: Our Social Security plan is going to cost $7000/worker (not taking into account the Medicare costs for these 80m) by the time all the baby boomers are retired. Who knows, maybe we'll get lucky and they'll start to die before reaching 85. Then the program will cost each worker maybe only $5000/year
80 million baby boomers retiring over next ~18 years starting 2011.
Avg. Social Security paycheck according to 2001 Census: $1051
80million*$1000/month is $80,000,000,000/month ($80billion/month)
Currently 131million US workers.
That's $7000/worker, per year.
Robbing your children: PRICELESS.
Before someone makes one of those "spend less on wars" comments,
Total cost of Iraq War these last 9 years has been ~$700B
Our yearly interest payment is >50% of the total cost of the Iraq war.
Total spent on wars since 2001-- ~<$1T
Our yearly expenditure for 80m baby boomers will be >$1T PER YEAR.
So "not doing the wars" wouldn't help us much [any].
also, August 2008 CBO Social Security stats-- notice how the crossover point isn't until like...2020.... http://www.cbo.gov/ftpdocs/96xx/doc9649/08-20-SocialSecurityUpdate.pdf
and where is it now? daayyyum we just crossed it!!! August 2009-- http://www.cbo.gov/ftpdocs/104xx/doc10457/08-07-SocialSecurity_Update.pdf
Outlays will probably stay above revenues (in contradiction with the CBO estimates) because, I believe, the CBO estimates are assuming a return to economic growth this year (which I have decent reservations about* but I may be wrong).
The shock from the trend up, in outlays, to the Federal Deficit, is double because of Unified Accounting (which we returned to under Nixon)-- UA lets us take that extra 1% we were raking in, and reinvest it in Treasury bonds, and take that value off the official Federal Deficit numbers. So, when the outlays trend up, we're both spending more on the actual Social Security checks, and can't pad our deficit levels with the extra 1%. Hence the double effect on the deficit.
Who knows maybe they can just gradually decrease SS benefits to old people. But then they'll have to sell off more of their stocks/assets (like houses), depressing economic activity...
(*reservations: http://2.bp.blogspot.com/_nSTO-vZpS...s/xahZhsGWJzg/s1600-h/illinois+budget+gap.jpg -- states going to have to cut back on their spending a lot. Aside from the guy mislabeling KY, lol, I believe those numbers check out.)
TL;DR version: Our Social Security plan is going to cost $7000/worker (not taking into account the Medicare costs for these 80m) by the time all the baby boomers are retired. Who knows, maybe we'll get lucky and they'll start to die before reaching 85. Then the program will cost each worker maybe only $5000/year
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