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The Future Financial Status of the Social Security Program


Stephen Goss


Social Security Administration - Office of the Actuary

August 2, 2010

Social Security Bulletin, Vol. 70, No. 3, pp. 111-125, 2010

Abstract:     
The concepts of solvency, sustainability, and budget impact are common in discussions of Social Security, but are not well understood. Currently, the Social Security Board of Trustees projects program cost to rise by 2035 so that taxes will be enough to pay for only 75  percent of scheduled benefits. This increase in cost results from population aging, not because we are living longer, but because birth rates dropped from three to two children per woman. Importantly, this shortfall is basically stable after 2035; adjustments to taxes or benefits that offset the effects of the lower birth rate may restore solvency for the Social Security program on a sustainable basis for the foreseeable future. Finally, as Treasury debt securities (trust fund assets) are redeemed in the future, they will just be replaced with public debt. If trust fund assets are exhausted without reform, benefits will necessarily be lowered with no effect on budget deficits.

Number of Pages in PDF File: 15

Keywords: Social Security, Solvency, Board of Trustees, Trust Funds, Actuarial Status, Budget Scoring

JEL Classification: H55

Accepted Paper Series


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Date posted: August 9, 2010  

Suggested Citation

Goss, Stephen, The Future Financial Status of the Social Security Program (August 2, 2010). Social Security Bulletin, Vol. 70, No. 3, pp. 111-125, 2010. Available at SSRN: http://ssrn.com/abstract=1646380

Contact Information

Stephen Goss (Contact Author)
Social Security Administration - Office of the Actuary ( email )
Suite 700 Altmeyer Bldg
6401 Security Blvd
Baltimore, MD 21235
United States
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