Social Insecurity: Inside the ‘Trust Fund’ Illusion
By CHARLES HUGH SMITH
The recent tax deal approved by Congress and the president cut the payroll taxes that employees will contribute to Social Security for 2011 by about a third, and that $112 billion reduction in receipts has advocates of the program worried that the political meddling in Social Security’s finances may threaten its viability.
Unfortunately, the Social Security Administration’s (SSA) finances have been meddled with for decades, and a one-year tax holiday is the least of the program’s problems. As I reported on DailyFinance this week, Social Security is already deep in the red, with outlays exceeding payroll tax revenues by $76 billion in 2010 — a deficit that wasn’t expected to occur until 2018.