SS Trust Fund Exhaustion 1 yr early 'cause new low interest rate future

[papau]

Seems no wage growth under Bush means payroll taxes do not increase as much as was anticipated last year. Also someone told the actuaries that we would have a low interest climate for the next 10 years - so the Trust assets do not produce as much income.



Summary http://www.ssa.gov/OACT/TRSUM/trsummary.html
Table of Contents http://www.ssa.gov/OACT/TR/TR05/trTOC.html
List of Tables http://www.ssa.gov/OACT/TR/TR05/trLOT.html
List of Figures http://www.ssa.gov/OACT/TR/TR05/trLOF.html
Glossary http://www.ssa.gov/OACT/TR/TR05/VI_glossary.html
Index http://www.ssa.gov/OACT/TR/TR05/trIX.html

Changes in starting values for the economic assumptions and in the transition to ultimate economic assumptions have a negative effect on the long-range actuarial balance. Higher than expected inflation in 2004 affected benefit payments more than taxable payroll. Taxable payroll for 2004 is close to that projected in last year's report. However, the cost-of-living adjustment (COLA) for December 2004 was estimated to be 1.1 percent in last year's report, but turned out to be 2.7 percent. This contributes toward higher benefit payments than projected in last year's report for at least the next 20 years. In addition, the projected real interest rate on trust fund investments during the first 10 years of the projection period is lower this year, consistent with recent data. This change also has a negative effect on the actuarial balance. The net effect of these economic changes is a reduction (worsening) in the long-range actuarial balance of about 0.06 percent of taxable payroll.

[Warpy]

1. There is no trust fund

Both parties have robbed it for 20 years to cover up their tax cuts to the rich.

[papau]

3. The Trust Fund is as real as the gov bonds in my mutual fund - its just

that the rich will not raise their taxes to pay off Soc Sec bonds, but they will raise their taxes to pay off my mutual fund bonds.

[gratuitous]

2. Which means, naturally

That the expected return on the private (or are we calling them personal today?) accounts will be lower, as well. Which means that they are less likely to fill the gap between the benefits cut and the guaranteed benefit.

But that's okay; Stupidhead won't be depending on social security benefits to keep him from fighting the cat for scraps. Sucks for you if that's your lot.

[papau]

4. Very True - and another point our media will not report tonight.

:-(

[mbperrin]

5. Yep, 7 rate increases in a row by the Fed definitely

points to a low interest rate future!!

(or not)