WILLisms.com: Social Security Reform Thursday: Week Sixty-Eight -- Miscellaneous Facts.

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Social Security Reform Thursday: Week Sixty-Eight -- Miscellaneous Facts.

Thursdays are good days for reform, because they fall between Wednesdays and Fridays.

That's why WILLisms.com offers a chart or graph, every Thursday or so, pertinent to Social Security reform.

This week's topic:

Why Reform Last Year Was So Imperative.

Fact: The first Baby Boomers will start to collect benefits in 2008, causing Social Security costs to rise.

Fact The Social Security cash surplus will peak at $88 BILLION in 2008 (in 2006 dollars). Each year afterwards, declining Social Security surpluses will create a bigger problem for the overall federal budget. In other words, the mask comes off, and we'll no longer be able to conceal the warts on the budget.

Fact: If the next President serves for two terms, he will serve through 2017.

Fact: From 2009-2017, the number of retirees receiving Social Security will grow by 23.9%, the number of workers by only 4.3%. In other words, the number of retirees will grow more than five times faster than the worker population.

A visual of that:

Fact: Nobody, even among the most aggressive reformers, wants to touch benefits for America's seniors. Because we missed such a prime opportunity in 2005/2006, the next administration and Congressional leadership will thus find it nearly impossible to uphold that principle without painful tax increases.

Fact: At the end of the next President’s second term (in 2017), Social Security's costs will become greater than Social Security's tax revenue.

Fact: From 2009-2017, the cost of paying Social Security benefits will rise, as a percentage of worker wages, by 17%.

Fact: If we did modernize and reform Social Security today, future Social Security benefits could rise in real terms without raising tax rates or raising the payroll tax cap, now or ever.

Fact: Assuming our next President is a two-termer, early in his second term, it will no longer be possible to maintain solvency without tax increases, even if all future workers’ benefits grow only at the rate of inflation (reminder: they grow faster than inflation). Were reform delayed that long, we must either start to cut benefits in real terms, or taxes must rise.

It's been time for reform. It's too bad there was so little leadership on this issue in the Congress, when we had GOP majorities and a GOP Executive. As of this moment, it's still not too late. By the time the next President is in office, it very well may be.

The clock is still ticking:

Tune into WILLisms.com each Thursday for more important graphical data supporting Social Security reform.

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Previous Reform Thursday graphics can be seen here:

-Week One (Costs Exceed Revenues).
-Week Two (Social Security Can't Pay Promised Benefits).
-Week Three (Americans Getting Older).
-Week Three, bonus (The Templeton Curve).
-Week Four (Fewer Workers, More Retirees).
-Week Five (History of Payroll Tax Base Increases).
-Week Six (Seniors Living Longer).
-Week Six, bonus (Less Workers, More Beneficiaries).
-Week Seven (History of Payroll Tax Increases).
-Week Seven, bonus (Personal Accounts Do Achieve Solvency).
-Week Eight (Forty Year Trend Of Increasing Mandatory Spending).
-Week Nine (Diminishing Benefits Sans Reform).
-Week Ten (Elderly Dependence On Social Security).
-Week Eleven (Entitlement Spending Eating The Budget).
-Week Twelve (Benefit Comparison, Bush's Plan versus No Plan).
-Week Thirteen (Younger Americans and Lifecycle Funds).
-Week Fourteen (The Thrift Savings Plan).
-Week Fifteen (Understanding Progressive Indexing).
-Week Sixteen (The Graying of America).
-Week Seventeen (Debunking Myths).
-Week Eighteen (Debunking Myths).
-Week Nineteen (Reform Needed Sooner Rather Than Later).
-Week Twenty (Global Success With Personal Accounts).
-Week Twenty-One (GROW Accounts: Stopping The Raid).
-Week Twenty-Two (Millions of Lockboxes).
-Week Twenty-Three (Support for Ryan-DeMint).
-Week Twenty-Four (KidSave Accounts).
-Week Twenty-Five (Latinos and Social Security).
-Week Twenty-Six (AmeriSave).
-Week Twenty-Seven (Cost Of Doing Nothing).
-Week Twenty-Eight (Chile).
-Week Twenty-Nine (Entitlement Spending Out Of Control).
-Week Thirty (Reform Better Deal Than Status Quo).
-Week Thirty-One (Social Security As A Labor Cost).
-Week Thirty-Two (Social Security And Dependence On Government).
-Week Thirty-Three (Social Security, Currently A Bad Deal For African-Americans).
-Week Thirty-Four (Longer Life Expectancies Straining Social Security).
-Week Thirty-Five (Howard Dean & Salami).
-Week Thirty-Six (Growing Numbers of Beneficiaries Draining Social Security).
-Week Thirty-Seven (The Crisis Is Now).
-Week Thirty-Eight (Disability Benefits).
-Week Thirty-Nine (Broken Benefit Calculation Formula).
-Week Forty (German Social Security Disaster).
-Week Forty-One (Crumbling Pyramid Scheme).
-Week Forty-Two (Overpromising, Globally).
-Week Forty-Three (Demographic Wave).
-Week Forty-Four (The Jerk Store).
-Week Forty-Five (Defined Benefit Plans).
-Week Forty-Six (Even The Empty Promises Are A Bad Deal).
-Week Forty-Seven (Our Aging Population).
-Week Forty-Eight (The Tax Increases Required To Cover Social Security's Costs).
-Week Forty-Nine (Much Longer To Get Your Money Back From Social Security).
-Week Fifty (A Vote, At Last).
-Week Fifty-One (We Can Do Better).
-Week Fifty-Two (Socialist Security).
-Week Fifty-Three (China Has The Same Problem, Only Worse).
-Week Fifty-Four (Potential Crisis Size).
-Week Fifty-Five (The Crisis Moves Closer).
-Week Fifty-Six (Big Brother Social Security).
-Week Fifty-Seven (Personal Accounts Are Awesome).
-Week Fifty-Eight (Private Accounts and Presidential Proposals).
-Week Fifty-Nine (The False Promises Of Social Security = Unwise Investing/Saving).
-Week Sixty (Declining Rate Of Return).
-Week Sixty-One (Entitlement Spending Threatens America's Defense Capabilities).
-Week Sixty-Two (Dismal Rates Of Return Only Getting Worse).
-Week Sixty-Three (Lost Time, Growing Shortfall).
-Week Sixty-Four (Solutions & Consequences).
-Week Sixty-Five (Totalization Agreements).
-Week Sixty-Six (The 7.65% Solution).
-Week Sixty-Seven (No Reform Means The End Of Many Federal Agencies Or, More Likely, Higher Taxes).

Posted by Will Franklin · 18 January 2007 08:04 PM

Comments

Correct me if I'm wrong, but is it true that the privitazation plan would have been optional? That is, would people have been able to choose to privatize or continue with the old method?

Posted by: JohnJ at January 18, 2007 09:39 PM

johnj, I believe you are right.

Posted by: zsa zsa at January 20, 2007 04:12 PM