Club for Growth v. Bartlett on Measuring Fiscal Crisis
David Hogberg has made some rather outrageous claims on this alleged Social Security crisis but Yes, Virgina, It’s a Crisis is interesting:
One might think that a system whose surplus will begin declining in 2009, that will begin taking in less in taxes than it pays out in benefits in 2018, and will cost taxpayers about an extra $25 trillion over 75-years is a system headed for a crisis…One last thing to consider: If we wanted to invest money today to cover the 75-year shortfall, it would require $3.7 trillion. That’s “only” about one-third of our current gross domestic product.
We’ve been through this 2018-just-IOUs nonsense enough and of course the surplus declining rant would only convince a village idiot like Don Luskin. But yes, $3.7 trillion is indeed one-third of current GDP.
But Bruce Bartlett had $44 trillion being only 6.5% of GDP. Oh, that’s GDP in 2075 not 2004. To be fair to Bruce, we should compare the present value of any budget shortfall to the present value of GDP over the same time period. But then Hogberg would not be allowed to do that by the Club for Growth.