Social Security’s wake-up call

What happened

The trustees for Medicare and Social Security reported Tuesday that both programs are on track to run short of money earlier than forecast, due to a recession-driven drop in tax revenue. Social Security’s trust fund is now expected to be insolvent in 2037, instead of 2041, and Medicare’s hospital trust fund will run out of money in 2017, instead of 2019. (Reuters)

What the commentators said

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So FDR’s “national Ponzi scheme,” Social Security, is even closer to collapse, said Matthew Vadum in The American Spectator. The trustees blame the economic downturn and longer life spans, but the real problem is “liberal activism.” After all, it was left-wing groups that sank President Bush’s plan to put Social Security on a “sound financial footing.”

Even after the 401(k)-decimating financial meltdown, conservatives are still pushing Social Security privatization? said James Ridgeway in Mother Jones. Social Security is solvent for 28 years—which is 28 years ahead of Citibank and Bank of America. And if conservatives use this “manufactured crisis” to push for Social Security cuts, they’re essentially robbing “elders to pay for the Wall Street bailout.”

So plays out “every journalist’s favorite annual kabuki ritual,” said Megan McArdle in The Atlantic, with conservatives warning of a fiscal “geezer apocalypse” and liberals arguing that Social Security is fine. Both sides have a point: Social Security’s shortfall isn’t “catastrophically large,” but we can’t ignore the program’s “immense” political and structural problem—we encourage longer-living workers to retire too soon.