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Has the recession destroyed the Social Security Surplus?

It looks as though the Social Security Administration is another victim of the worsening U.S. recession.  While everyone was busy fretting over the stock market, the AIG bailout fiasco, or the rocky stock market, the SSA surplus seems to have disappeared eight years ahead of schedule.  Injured or disabled workers relying on SS disability to stay afloat should take note.

 

Up until now the SSA has been a positive in the federal budget, bringing in $50 to $100 billion more in payroll taxes than it paid out in benefits.  While the SSA was expected to run out of money eventually, it was not supposed to happen for a while longer.  Unfortunately, it seems that the end of the surplus might happen sooner rather than later.

 

The Congressional Budget Office has estimated that the SSA surplus will be about $3 billion in 2010, a huge difference from years past.  And if the economy continues to get worse, that figure could be an overstatement.  This is troubling news for an agency so many depend on, and one that was expected to run on its surplus until the year 2017.

 

The new administration may need to tackle the thorny issue of Social Security reform sooner rather than later.

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