Relevant and even prescient commentary on news, politics and the economy.

Soc Sec XLIV: ‘We can’t grow our way out of this’

In reviewing some of the final comments on XLI: Why not assume Low Cost the following partial comment caught my eye: “We are not going to grow our way out of this. And it’s highly unlikely that we will tax our way out, either.” To which I would want to ask: “Who says? And can […]

Soc Sec XLIII: Solvency: Demographics or Productivity?

I don’t want to pile on but I did think the new actuarial note was important enough to justify the XLII post. I want here to front a discussion from the comments on XLI: Why not assume Low Cost? where I think people are talking past each other. There seems to be some confusion between […]

Soc Sec XLII: Unfunded Obligation and Transition Cost

In a really timely fashion the Office of the Chief Actuary released their Actuarial Note 2008.1 with the above title last month. It is well worth the read for anyone wanting to cut through the conceptual tangle raised in the recent posts on ‘Unfunded Liabilities’ and ‘Backwards transfers’. In addition it provides us with some […]

Soc Sec XLI: Why not assume Low Cost?

I have never gotten a satisfactory answer to this question. I have posed it to very prominant people on both sides of Social Security only to have it dismissed by the privatizer and answered by the SS supporter in a way that went over my head. But it is not crazy talk, between 1997 and […]

Soc Sec XL: Double books and the ‘No Economist Left Behind’ Challenge

In November of 2004 Dean Baker issued his ‘No Economist/Policy Analyst Left Behind’ challenge. In it he asked people to show that they could produce the 6.5% return on stocks assumed by the Council of Economic Advisors under the actual economic projections of the Intermediate Cost alternative. (Oddly enough for an open and public challenge […]

Soc Sec XXXIX: Pay/Go & Unfunded Liabilities

In the course of the two posts on Backwards Transfers (XXXVI & XXXVII) it became clear that even experts had a somewhat confused concept of the relation of past and future as it comes to Social Security finance. So this post will attempt to add some clarity. Social Security is by design a Pay/Go system […]

Soc Sec XXXVIII: Financing Shortfall

(Erroneously put up as XXXVII)Prior to 2004 Social Security Crisis was explained with a simple narrative: Boomers retire placing enormous strain on system, Trust Funds go bankrupt in short order, checks stop. Result? Social Security won’t be there for me. This storyline was always nonsense, as long as payroll tax is being collected benefits would […]

Soc Sec XXXVII: Backwards Transfers: Biggs Responds

Soc Sec XXXVI: $17 Trillion Backward Transfer was a response to a comment by Jim Glass ( to a post by Andrew Biggs. Andrew responded with a new post attempting to rebut my argument. You can see the whole thing at Responding to Angry Bear: Where does $17 trillion come from including my response to […]

Soc Sec XXXVI: $17 trillion backward transfer

Time to knock this one down before it gets started. Over at Andrew Bigg’s blog he has a post up called Academy of Actuaries: Raise the Retirement Age. I am not particularly concerned with the text quoted which actually amounts to some AP guy’s take on an advance copy of what the Academy will actually […]

Soc Sec XXXV: Monthly Trust Fund Reports

It is almost impossible to figure out whether Social Security is tracking better or worse than projected using productivity or Real GDP, for one thing the data lags and moreover is subject to revision. But there is one measure that can be tracked with precision: Trust Fund cash balances which are reported to the penny […]