Congressional Budget Office warns of Social Security insolvency by 2033
By Betsi Fores
The Daily Caller News Foundation
Social Security did not take in as much money as it spent last year, according to the latest report by the Congressional Budget Office (CBO).
The CBO estimates that over the next ten years, Social Security expenditures will continue to exceed the dedicated revenues by about10 percent as the Baby Boomers retire .
“That gap will grow larger in the 2020s, and by 2030, Social Security outlays will be about 6 percent of gross domestic product and will exceed dedicated tax revenues by about 20 percent,” the CBO writes.
For fiscal year 2012, Social Security spending totaled $773 billion, nearly 5 percent of GDP.
The projected year of Social Security insolvency continues to be moved up, with the latest projections being 2033.
“Many Democrats on Capitol Hill argue that Social Security isn’t in dire shape, in part because the program holds assets in special-issue U.S. Treasury securities. Still, the CBO report offers a warning for the future, noting that an aging population will put more pressure on Social Security,” the Wall Street Journal reports.
The payroll tax that pays for the entitlement program was suspended in 2010 to encourage middle-class consumer spending. It will likely be reinstated after the end of the year.
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