The Boomers, The Budget, And The So-Called Bust

[reprehensor]

The Boomers, The Budget, And The So-Called Bust

by Robert Reich

Broadcast February 9, 2005

Start with this basic fact. The massive post-war baby boom generation is a demographic bulge moving through the American population like a pig through a python.

Today’s boomers bankroll today’s Social Security retirees with their payroll taxes, as does every generation. That’s the way Social Security was designed – as a pay-as-you-go system. But boomers outnumber retirees. So, there’s extra money in the kitty – a Social Security surplus.

Here’s the dirty little secret. Those surpluses are being used to reduce the President’s budget deficits. The President’s new budget predicts that this year’s deficit will be $427 billion. But it would be much, much larger -- a whopping $589 billion -- without this year’s Social Security surplus.

Over the next decade, more boomers will be in their peak earning years, which means the Social Security surplus is going to swell. And the White House plans to use these growing surpluses to reduce future budget deficits even more. In fact, a big reason why they predict their deficits will drop is because the Social Security surplus will grow.

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[applegrove]

1. Go Robert! Go Robert! Go Robert!

:loveya: