Newspaper article The Florida Times Union

Social Security Not at Risk If Tapped, Analysts Assure

Newspaper article The Florida Times Union

Social Security Not at Risk If Tapped, Analysts Assure

Article excerpt

WASHINGTON -- As the Republican-controlled Congress ties itself in knots to avoid spending a penny of the Social Security budget surplus, economists and budget analysts say politicians have created an artificial crisis that has little or nothing to do with economics or the safety of retiree benefits.

While budget experts applaud the impulse to limit federal spending, they say politicians have elevated what is essentially an arcane accounting device to a matter of life-or-death national policy that somehow threatens Social Security recipients. Not so, experts say.

"A good goal has been transformed into a political football that's very ugly, trying to scare people into saying if you dip into Social Security money it's somehow coming out of beneficiaries' benefits," said Robert Bixby, policy director for the Concord Coalition, a budget watchdog group. "It has absolutely nothing to do with beneficiaries."

At stake here are the huge annual surpluses generated by the Social Security program, which for years has been collecting more payroll taxes than it needs to pay current benefits. Technically, that extra money is being banked to pay baby boomer retirement benefits in the next century.

But just as a bank books deposits and lends out the cash, Social Security for years has been lending its surplus cash to the Treasury to pay the day-to-day bills of the rest of the government. Experts say that doesn't change the amount of the deposits in the Social Security trust funds, or retirees' entitlement to draw on them.

When Social Security needs the money, the government will have to make good by drawing on non-Social Security surpluses, cutting other spending, raising taxes or running budget deficits again. Indeed, under current law, there is no way for Social Security to "save" its excess cash except by reducing the national debt, which will essentially put the government in a better position to run up deficits again if that becomes necessary. …

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