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The obama administration can't seem to keep their facts straight- here's a LIBERAL obama worshipper in her own words refuting what obama is claiming Barbara Kennelly: Well, Lindsey is reporting as people report and say, “Hey, the number went from 2041 down to 2037″. And yeah, that is a drop and are we surprised? No, we have a recession. Are we surprised that tens of thousands people have been laid off and are not paying into the payroll tax. But the Social Security program has been designed specifically to have these economic going up and going down. I was on the committee in 1983 the last time we reformed it. We raised the payroll tax, we raised the age because we knew the baby boomers were coming. So no, Social Security is not going bankrupt. Do we have a problem right now? We have a fiscal problem. We’ve got a deficit problem. We don’t have a Social Security problem because we have that surplus. Think of the good years we had in 2005, 2006, 2007, 2008. So much more money was coming in to Social Security from payroll taxes than was going out. That built up the surplus. So that’s the base we have right now. That’s why we can go up to 2037 and say Social Security can still pay its benefits. http://www.ss.com/2009/barbara-kennelly-on-social-security-and-medicare-trustees-report/

Hey, the number went from 2041 down to 2037″. And yeah, that is a drop and are we surprised? No, we have a recession. Are we surprised that tens of thousands people have been laid off and are not paying into the payroll tax. But the Social Security program has been designed specifically to have these economic going up and going down.

SS is a pay as you go system. The 2041 or 2037 dates are when the last IOUs from the SS Trust Fund are cashed in using money from the General Fund. The system is unsustainable unless you raise taxes or cut benefits or both.

I was on the committee in 1983 the last time we reformed it. We raised the payroll tax, we raised the age because we knew the baby boomers were coming. So no, Social Security is not going bankrupt. Do we have a problem right now? We have a fiscal problem. We’ve got a deficit problem

It was "reformed" by raising taxes and reducing benefits. That just kicks the can down the road. The 1983 "solution" P.L. 98-21, (H.R. 1900) was supposed to make SS solvent for 75 years. Instead, 33 years later we will be back in the same situation, i.e., in 2016. We have a structural problem of having fewer workers for every retiree (2 to one in 2030 compared to 3.3 now and 16 in 1950) and the fact that SS COLA increases are not linked to revenue. The system is on automatic pilot.

Do we have a problem right now? We have a fiscal problem. We’ve got a deficit problem. We don’t have a Social Security problem because we have that surplus. Think of the good years we had in 2005, 2006, 2007, 2008. So much more money was coming in to Social Security from payroll taxes than was going out. That built up the surplus. So that’s the base we have right now. That’s why we can go up to 2037 and say Social Security can still pay its benefits.

Pure sophistry. This is the way SS works. The "surplus" is just the difference between benefits payed out and what is left over each year. The "surplus" is deposited into the General Fund. In return, Treasury issues non-market T-Bills in the amount of the "surplus" (IOUs) and they are deposited into the SSTF. The SSTF represents an unfunded liability, which is why it is included in our current $12.1 trillion national debt under intragovernmental holdings.

This year and last, some of those IOUs are being cashed in because there is no surplus. It is temporary due to the economic downturn. But by 2016, SS goes permanently into the red, i.e., it will be paying out more than it is taking in. The SSTF really just represents the full faith and credit of the USG to pay SS benefits. It is a gimmick meant to fool and deceive.

SS is unsustainable as currently structured. The data are clear. It is a Ponzi scheme. Those of us collecting benefits now are getting far more than we ever payed into the system.

Social Security could be brought into actuarial balance over the next 75 years with changes equivalent to an immediate 16 percent increase in the payroll tax (from a rate of 12.4 percent to 14.4 percent) or an immediate reduction in benefits of 13 percent or some combination of the two. Ensuring that the system remains solvent on a sustainable basis beyond the next 75 years would require larger changes because increasing longevity will result in people receiving benefits for ever longer periods of retirement.