Krugman had solution to SS "underfunding" last night on Lou Dobbs.

[MikeG]

Wait a few years.

The "crisis" year keeps moving back two years for every year.

We may not have to do ANYTHING.

[Inland]

1. It is the nature of relying on a worst case scenario, as SSA does

The trust fund running out in 2042 according to the worst case scenario means that the economy hits the crapper today and payroll taxes are lower from today and every day to 2042.

So each day the economy doesn't hit the crappy is a day of normal tax receipts and the dooms day is put off, not just by one day, but more than one.

It is my memory, when the trust fund was created through the huge Reagan hike in payroll taxes, the worst case scenario had the dooms day in 2011. By having twenty years of decent growth, we have pushed back the dooms day to 2042.

My thought is, if things really get so bad, then we really should cut benefits because the entire world, not just seniors, will be impovershed. If things don't really get so bad, then there will be no benefit cuts. Doing nothing strikes me as the best of all reactions to a non-problem..

[bryant69]

2. what's funny too

Is that for the private accounts to save the system the economy has to do well enough that there won't be a problem with SOcial Security. Conversely if the economy stays lousy, than the private accounts won't make enough money to make up the difference.

Bryant
Check it out --> http://politicalcomment.blogspot.com

[papau]

3. true - the out year GDP growth of 1.6% is always exceeded

actuaries are use "conservative" assumptions 'cause that is how we are trained and that is how the Standards read.