Not necessarily! The balance in the Trust Fund is continuing to grow and will for several more years until a large percent of the BBs retire. At the end of Dec. the balance was 3,915,559 million. According to the Trustees medium estimate, it won't be eaten up until about 2042. In subsequent years, a small deficit in revenues is projected assuming the tax rate remains unchanged. Of course, the projection is based on assumptions about life expectancies, birth rate and the economy, etc., all of which may be wrong.
With the increase in the latino population, the birth rate will increase and the ratio of workers to retired may increase. On the other hand, there are a number of areas in the assumptions that may have resulted in revenues being over estimated And, the present mess in our economy is probably the largest. It may reduce revenues dramatically along with the value of the dollars in the TF. We have also been increasing the relative income of the top 10 or 20 percent and, as a result, the cap in income subjected to the payroll tax, may be having a greater impact.
Larry |
