Word: cbo
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...Well, no need to worry about 2017 anymore. Thanks to the worst economic downturn since the 1930s, the moment of reckoning is already almost here: according to both the budget proposed by the White House in February and projections issued by the Congressional Budget Office (CBO) in March, Social Security benefits ($659 billion, according to the CBO) will exceed payroll taxes ($653 billion) in fiscal 2009 for the first time since 1984. Payroll-tax receipts generally hold up much better in recessions than do income taxes, but job losses have been so severe that the CBO expects them to decline...
...system will still manage to provide a slight surplus for federal coffers in fiscal 2009. But from 2010 through 2012, there are small projected deficits, and after heading back into the black from 2013 to 2015, the program will then become a growing drain on federal finances, projects the CBO...
...This is partly because officially, Social Security is still running a substantial surplus and will be throughout the next decade, according to the CBO. A key source of that surplus, though, is interest payments on federal debt held by the Social Security trust fund. It's money that Social Security has definitely earned, but it's coming out of the rest of the federal budget. Same goes for employer contributions to Social Security for federal employees, which also boost the program's bottom line but not the government...
...budget, stimulus package, and bank bailout assumptions for employment and revenue are no longer right, the government's pot for solving the nation's economic problems is already light. The Administration's forecast is that unemployment will average 8.1% this year and 7.9% next year. The CBO estimates are a bit higher. Based on where unemployment stands now and where it will likely be at mid-year, none of those numbers is even remotely realistic. (See pictures of the Top 10 scared traders...
...economy recovers, and sustained deficits revert to dangers that can damage economic growth. "In terms of getting our act together, we are certainly going to be facing the longer term in a bad position," said Alan Auerbach, an economist at U.C. Berkeley, about the latest round of CBO estimates...