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Elder Law Prof Blog
Katherine C. Pearson, Editor, and a Member of the Law Professor Blogs Network on LexBlog.com

2009 SS Trustees Report revises last year’s estimates

By Elder Law Prof Blog

The Social Security Board of Trustees today released its annualreport on the financial health of the Social Security Trust Funds.  TheTrustees project that program costs will exceed tax revenues in 2016,one year sooner than projected in last year’s report.  The combinedassets of the Old-Age and Survivors, and Disability Insurance (OASDI)Trust Funds will be exhausted in 2037, four years sooner than projectedlast year.  The worsening of the long-range outlook for the SocialSecurity program is due primarily to the recent economic downturn andfaster reductions in mortality than previously assumed.

In the 2009 Annual Report to Congress, the Trustees announced:

  • Theprojected point at which tax revenues will fall below program costscomes in 2016 — one year sooner than the estimate in last year’sreport.
  • Theprojected point at which the Trust Funds will be exhausted comes in2037 — four years sooner than the estimate in last year’s report.
  • Theprojected actuarial deficit over the 75-year long-range period is 2.00percent of taxable payroll — up from 1.70 percent in last year’sreport.
  • Overthe 75-year period, the Trust Funds would require additional revenueequivalent to $5.3 trillion in today’s dollars to pay all scheduledbenefits.

“Today’s TrusteesReport contains some disappointing, but not unexpected, news about thefinancial condition of the Trust Funds,” Commissioner Astrue said.  “Weshould be neither casual nor hysterical about the revised insolvencydates.  As with the economy as a whole, the Social Security system willweather this recession.  However, the sooner we get on with the task ofreforming the system, the easier it will be to make the tough choicesthat we all know we need to make.”

Other highlights of the Trustees Report include:

  • Incomeincluding interest to the combined Old-Age and Survivors, andDisability Insurance (OASDI) Trust Funds amounted to $805 billion ($672billion in net contributions, $17 billion from taxation of benefits and$116 billion in interest) in 2008.
  • Total expenditures from the combined OASDI Trust Funds amounted to $625 billion in 2008.
  • The assets of the combined OASDI Trust Funds increased by about $180 billion in 2008 to a total of $2.4 trillion.
  • During 2008, an estimated 162 million people had earnings covered by Social Security and paid payroll taxes.
  • SocialSecurity paid benefits of $615 billion in calendar year 2008.  Therewere almost 51 million beneficiaries at the end of the calendar year.
  • The cost of $5.7 billion to administer the program in 2008 was a very low 0.9 percent of total expenditures.
  • The combined Trust Fund assets earned interest at an effective annual rate of 5.1 percent in 2008.

TheBoard of Trustees is comprised of six members.  Four serve by virtue oftheir positions with the federal government: Timothy F. Geithner,Secretary of the Treasury and Managing Trustee; Michael J. Astrue,Commissioner of Social Security; Kathleen Sebelius, Secretary of Healthand Human Services; and Hilda L. Solis, Secretary of Labor.  The twopublic trustee positions are currently vacant.

The 2009 Trustees Report will be posted at www.socialsecurity.gov/OACT/TR/2009/.  

Posted in:
Social Security