The End Of The Rainbow

And the leprechaun took a twenty-seven-year dump in the pot:

Five years ago, when President Bush made his pitch to reform Social Security, the program was projected to start running annual deficits in 2018.

But in its yearly report released [last Thurs]day, the Social Security Trustees have projected that due to the weak economy, the program will be paying out more benefits than it collects in taxes in both 2010 and 2011. Anticipating that the economy will recover, the trustees project that program will return to surpluses for a few years, but then, starting in 2015, it will begin consistently running deficits every year.

And if the economy doesn't recover - as it never will as long as Red Barry's in control of it - well, I think you can figure out the answer.

This day was always coming.  Ever since the last Social Security crisis - "solved" by a huge payroll tax hike that did nothing except kick the actuarial can of doom down the road a generation - the annual surpluses have been rolling into the "lockbox" and right back out again into the general fund to be spent, replaced by government debt that can only be "paid" by incurring MORE government debt.  Rather like a figure skater who goes into a spin and pulls in her arms to increase the speed.  Eventually she just can't spin any faster.  Now picture her juggling running chain saws at the same time.  The term "unsustainable" comes to mind.

But for another way to look at it, try Alan Sloane's contention that there's nothing there to sustain:

Today, let’s talk about one of the world’s biggest piles of funny money — the $2.54 trillion Social Security trust fund. It matters now because Social Security revealed plans last week to tap the fund for $41 billion this year and will begin tapping it on a regular basis in less than five years.

This year’s cash deficit, the first since the early 1980s and the biggest ever, means the government will have to borrow money to redeem some of the Treasury securities in the trust fund. Even at a time when Uncle Sam is borrowing $1.5 trillion a year to keep his checks from bouncing, $41 billion is real money.

Here’s why the trust fund is funny money. Let’s say I begin taking Social Security when I hit the full retirement age of 66 later this year. Because its tax revenue is below its expenses, Social Security would have to cash in about $3,400 of its trust-fund Treasurys each month to get the money to pay my wife and me. The Treasury, in turn, would have to borrow $3,400 from investors to get the money to pay Social Security. The bottom line is that the government has to borrow money to pay me, regardless of how big the trust fund is.

Because there's no MONEY in it.  The only way to get cash from it is to liquidate Treasury IOUs, and to do that MORE IOUs have to be sold.  Borrowing from Peter to pay Paul when there are ever fewer Peters and ever more Pauls.  Spin faster and faster and faster - until, eventually, it collapses, as all Ponzi schemes do.

This is why entitlements reform was an imperative back in the nineties.  Mr. Newt chose to repair Medicare, but Social Security was in the same dire actuarial straits.  The reason to privatize the Big Two back then was that the sooner it was undertaken, the less painfully it could be done.  Whereas the longer the looming fiscal Armageddon was ignored, the more agonizing would be the eventual fix - with lethal total collapse waiting at the very end if nothing was done.

President Bush's half-hearted, half-assed, unserious attempt at saving Social Security was the windmill on the tracks out to Clayton Ravine - the point of no return.  Dems, naturally, kicked and fearmongered the idea to death, uttering the same "what, me worry?" assurances that everything was JUST FINE that they did about the subprime real estate bubble they created.  Now we've run out of track, and while it LOOKS like a long way down, the ground will reach up a lot quicker than anybody is willing to admit.

Get a load of Ensign Ed's prognosis:

The solution has to include an end to deficit spending entirely, as well as a financial model that doesn’t resemble a Ponzi scheme.  Until we stop adding to our debt and start paying it down, Social Security will literally not exist except as floating debt with an illusion of substance.

Which the Democrats will NEVER allow, and the Republicans will NEVER have the courage to attempt absent the rise of a Christiesque successor to Red Barry in 2012, and will never succeed in implementing either way short of at least sixty seats in the Senate.  We've seen it over the past year and a half.  Marxist-Alinskyists will NEVER give up their ideology.  PERIOD.  They're extremists, they're blind guides, they're zelots, and they'll burn the country down instead of conceding that everything they believe in is crap and doesn't work.  Because to admit that they're ideologically wrong about everything is, to them, the same as saying they're MORALLY wrong about everything.  And they will not, and cannot, abide that fundamental truth.

Not even to keep Grandma in her Alpo.