Thanks to this innovation, over the years the social-security deficit was first checked and then turned into surplus in the three years from 1999.
We already are at the tipping point: In 2010, Social Security ran a deficit for the first time since the system was overhauled in the 1980s.
The Kerry camp insisted the senator from Massachusetts has a detailed plan to save Social Security by reducing the deficit and instituting fiscal discipline.
Social security is not in deficit spending at this time, but will require other tax sources by 2015 or it will be paying out more in benefits than it receives in the payroll taxes that fund the program.
Bush warned that because the war on terrorism and homeland security would cause a budget deficit, Congress would have to "act in a fiscally responsible way" to ensure the deficit would be small and temporary.
Obama and Democrats say they want to protect Medicare, Medicaid and Social Security, and that comprehensive deficit reduction must include increased taxes on wealthy Americans to prevent the burden of austerity steps from shifting too much to the middle class, the elderly and other vulnerable demographics.
Obama then added the nonsensical assertion made by Romney earlier about the deficit being a national security issue.
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Congress spent these surpluses, and the U.S. Treasury issued the Social Security Trust Fund special bonds, which can be redeemed whenever the Social Security system has a current account deficit.
Early reports from the deficit commission are touching the third-rail of politics (Social Security) and that may heighten the tax, spending and deficit cutting debate, leading to further gridlock in the upcoming lame-duck session.
Put simply, these initiatives will treat national and homeland security as a bill-payer for deficit reduction.
Does that say to the White House that Social Security as part of a debt-deficit plan may be a nonstarter in the Senate?
Obama also acknowledged that while Social Security is not the cause of the deficit, it needed long term reforms that would have to be tackled separately.
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In 2010, the Social Security system ran its first current account deficit since 1983, and for the first time since the reforms the deficit was covered by redeeming Trust Fund bonds.
We talked with Mark Miller, a journalist who specializes in retirement and aging, and he shared with us what he sees as the biggest immediate threat of all the proposed deficit reduction changes in Social Security.
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Imagine if he went to the floor (in Jimmy Stewart or Spencer Tracy fashion) to offer a powerfully symbolic piece of legislation -- for example, a balanced budget amendment to highlight the deficit issue or sweeping homeland security and veterans benefit legislation.
The truth is Social Security is not the huge contributor to the deficit that the other two entitlements are.
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Both of you have indicated you will likely raise the age of eligibility for Social Security benefits as a way of addressing a potential deficit in the system.
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There are competing plans to fix Social Security, Medicare as well as the national debt and deficit.
If inflation were higher, Social Security and entitlement payments would be higher and the budget deficit mess would be even worse.
Both step gingerly around changes to the enormously popular Social Security program, which will eventually start to run a deficit as more baby boomers retire.
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The White House has made clear it will accept the Social Security and Medicare cuts only as part of a big deficit reduction deal that also includes new tax revenues.
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In America the new deficit-focused climate is preventing politicians from passing a temporary (and sensible) fiscal stimulus package without inducing them to tackle the sources of the country's huge medium-term deficit by, for instance, reforming social security.
Social Security would have remained in surplus, instead of sinking into deficit.
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And also, if you could clarify your Social Security position -- would any of the money from Social Security, even from just Chained CPI, go toward the deficit as opposed to back into the trust fund?
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When questioned on the long-term deficit problems (in addition to the current deficit and the increases from TARP and ARRP, Social Security and Medicare are on an unsustainable path) by Sen.
But he also made very clear that we do not believe -- and a lot of independent economists back up our contention -- that Social Security is an issue in the near- and medium-term deficit.
They were ideas like privatizing Social Security, like moving back from a balanced budget and a surplus to deficit and debt.
Why is it that deficit reduction is a big emergency justifying making cuts in Social Security benefits but not closing some loopholes?
Are there clear red lines on entitlements other than keeping Social Security on a separate track and not using that as part of the deficit reduction?
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