"Well, if you or I were only able to pay 70% of our bills, I'm pretty sure our creditors would say that we are bankrupt."

By the same reasoning, you would have to declare the US bankrupt currently.

The point is that making up that worst-case 30% lag in SS benefits won't be catastrophic if we otherwise have our finances in oreder. We routinely carry budget deficits as large as the inflation-linked number will be. I'm not saying its not a problem, but I am saying its being over-hyped to herd people into the presidents plan- which has no positive effect on whatever prognostications of the impending cut-off. In other words- its revenue neutral at best.

"So, 2018, 2020, even 2025, the point is that the SS tax surplus will end in the not too distant future. What do we do about it?"

Two things: one, your pragmatic position is shared by me. Two, keep in mind that some entirely reasonable projections say that the surplus will not end for any appreciable time period anytime within a 70 year horizon. Again, I'm just pushing for perspective on the problem.

As for what we do about it, I am still in favor of raising the benefit age. Your prior post, which I have not compiled and checked entirely yet, but I hope to tonoght, points out some real issues with that- namely that there are lots of 'if-ands-or-buts' and loopholes about the benefit age. My initial response would be 'Okay, close the loopholes and address the ifs-ands-or-buts.'. Again, I recognize that it will be painful, but any solution will be. And This Solution is not as much as a cut in benefits (we live longer), nor is it an increase in tax, and the SS system maintains it 'pension fund' pretensions.

"by 2052, the payment will be about $4100. With only 2 workers paying in for every retiree, that's an average of over $2000 a month in SS taxes each. That's a high price to dump on my grandkids heads, and it doesn't even begin to address other serious issues like Medicare, Medicaid, and the growth in the rate of government spending. Sure, their income will be higher then, but so will the cost of everything."

And again we have to use a lot of assumptions about economic growth and inflation. And of course its a double edged sword. Throw in an Inflationary cycle and a recession in the next 20 and it gets worse. Throw in just a few years of Clinton-Era growth and PRESTO! SS problem solved.

HOWEVER, again, as Tom and I have commiserated together: From what I understand of the medicare/medicade problem, even if we had Clinton-Era growth for the next decade, we would STILL be in a bubbling hot pot of oil with few options.

Frankly, I think we are doing the wrong thing. We should be working on the big problem (medicare). It would be cool if we could 'prototype' a solution with SS, but thats not what were doing with the preznints plan. What we are doing is adding epicycles and whiz-bangs to an ailing plan. Its quite literally like blowing 3,000 on a new air-conditioner and fancy new heated seats and upholstery on a car that desperately needs a valve job and a timing chain.

And of course, then there are all the problems with the market economy.

But as far as the pragmatic solution, I still am in favor of a benefit age change. I hope to be out of the game by 55, and am planning a 10-15 year lag between retirement and SS kicking in, so its no skin off my back. I will get to your concerns with that (age change) when I can.

Davin :.