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2015 Social Security Report Release Day (w/updates)

At 1:30 EDT the Trustees of Social Security will hold a media availability at which they will release the 2015 Social Security and Medicare Reports. If past practice holds the Reports will be released on line at or before that time in both a web (HTML) format and in PDF. Assuming past file name conventions hold the two URLs will be:
http://www.ssa.gov/oact/tr/2015/index.html and
http://www.ssa.gov/oact/tr/2015/tr2015.pdf

Once the Report is released this post will be updated with key numbers, dates and talking points. I will also be working with the text of the Report to transform it into more readily accessible form as an Excel Workbook with associated .jpgs and .pngs of the more important Tables and Figures. More on that as we go along.

Note the above links will be dead until Report release. The actual launch page for current and past Reports is here:
http://www.ssa.gov/oact/tr/index.html
Right now that current Report shows as the 2014. This should update to 2015 immediately on release and so this is probably the best link to be clicking on in the meantime. At least it will get you somewhere other than dreaded Room 404.

Back with more when there is more.

Update 1 Report not out online but Treasury Press release has Trust Fund Depletion in 2034 and 75 year actuarial gap at 2.68 or down from 2.88. Reasonably good news but the devil is in the details which are still forthcoming.

Update 2 HTML version online under first URL cited above.

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CRS: Social Security: What Would Happen If the Trust Funds Ran Out?

Very interesting paper that I missed in real time.
Social Security: What Would Happen If the Trust Funds Ran Out?

Almost everyone who addresses this question assumes that the answer is pretty simple: if either of the Social Security Trust Funds goes to zero than benefits will automatically drop from ‘Scheduled’ to ‘Payable’ which translates to a 22-25% overnight cut depending on which Trust Fund we are talking about. But I had an interesting conversation with Andrew Biggs some years back. Andrew is a very prominent advocate of Social Security ‘reform’ which he sells on the basis that the system is ‘unsustainable’. As such he and I and Coberly and he have had some vigorous debates over the years, and mostly he is firmly in the ‘bad guy’ category on policy. For all that he is a nice guy and really, really knows the numbers and laws in play. Not least because he spent some time as the Principal Deputy Commissioner of Social Security (the no. 2) during the Bush Administration.

With that as background Biggs told me that the situation at Trust Fund Depletion was not as clear-cut as almost everyone assumed and had been the topic of some high end discussion at SSA. And their conclusion as related by Biggs to me mirrored that of the Congressional Research Service in this Report from last year.

The Social Security Trustees project that, under their intermediate assumptions and under current law, the Disability Insurance (DI) trust fund will become exhausted in 2016 and the Old-Age and Survivors Insurance (OASI) trust fund will become exhausted in 2034. Although the two funds are legally separate, they are often considered in combination. The trustees project that the combined Social Security trust funds will become exhausted in 2033. At that point, revenue would be sufficient to pay only about 77% of scheduled benefits.
If a trust fund became exhausted, there would be a conflict between two federal laws. Under the Social Security Act, beneficiaries would still be legally entitled to their full scheduled benefits. But the Antideficiency Act prohibits government spending in excess of available funds, so the
Social Security Administration (SSA) would not have legal authority to pay full Social Security benefits on time.
It is unclear what specific actions SSA would take if a trust fund were exhausted. After insolvency, Social Security would continue to receive tax income, from which a majority of scheduled benefits could be paid. One option would be to pay full benefit checks on a delayed
schedule; another would be to make timely but reduced payments. Social Security beneficiaries would remain legally entitled to full, timely benefits and could take legal action to claim the balance of their benefits.

The Report proceeds to outline the possible responses and is interesting for that alone. More important for my purposes though is the suggestion that the “conflict between two federal laws” precludes the option of Congress just sitting back and letting “automatic” cuts happen. Because as Biggs some years back and CRS last year point out, there is nothing automatic about this at all.

Anyway something to talk about for those of us jonesing over the release of the 2015 Social Security Report. Which my fellow junkies is scheduled for tomorrow (Wednesday) probably at 1PM Eastern. If past file name practices are observed the web version should be available via URL:
http://www.ssa.gov/oact/tr/2015/index.html
while a PDF version should be viewable or downloadable at:
http://www.ssa.gov/OACT/tr/2015/tr2015.pdf

I should have another post up with these same links prior to Report Release. But anyone who wants to bookmark the URLs and try to get a jump on just about everyone else in the country should feel free.

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Reading the 2014 Social Security Report: Released July 28

The Countdown is ON!

(Update 2: It’s out, links work. See you in Comments)
(Update for Post Publication) If things go as scheduled the 2014 Report of the Trustees of Social Security wil be released to the web at 12:15 Easter or less than two hours from the time this post published. Assuming the same continuity in URLs between Reports as we saw the last few years the liks below should go immediately live. Until then of course they are dead and for that matter untested. If by chance they remain broken eager beavers can go right to the main page of the Reports and link from there: http://www.ssa.gov/oact/tr/ . Or not, since that page was down just a second ago, possibly for updating. One way or another you will have linkage soon after noon.

The 2014 Report of the Trustees of Social Security is scheduled to be released at 12:15PM Eastern, or 15 minutes after the scheduled publication time of this post. Assuming that the file name conventions of past Reports are maintained each of the following links should come alive coincident with the public release of the Report in DC, at least in past years the release to the web has been instantaneous. But I guess we will see, and I will be testing and editing links as necessary.

The full Report is released in HTML and PDF. Those who want to read the Report in leisure can download it in PDF here: 2014 Social Security Report. On the other hand those who want to share impressions immediately would do better to work from the HTML version and its breakout of all the relevant Tables and Figures. 2014 Social Security Report linkable HTML version

Those readers who prefer their Reports unmediated feel free to dive in to either format. But for those who want some pointers as to valuable places to start and/or pointers on what those various Tables and Figures are trying to say can follow me below the fold.

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Waiting on the Social Security Trustees Report: April 1 and Counting

When I was a newbie Social Security commenter and then blogger back in the 1999-2004 era there was a day I only half faceticiously called “The Bestest Day of the Year at Webb House!”. Yes it was Social Security Report Release Day which came out like literal clockwork on March 31st, so much so that I actually had posts at the Bruce Web set up with links that would go live the second the Report was released. Except that one year in the Bush Administration it didn’t and then in the six years of the Obama Administration when they missed each and every year. Always for good reasons, I guess because they never actually explain them, but really no harm no foul. Right? Well I would argue (later) that there is a harm and certainly a foul, because this isn’t just some sort of event that mostly just happens to come when it did. Instead this is a legally established mandate embedded right i the Social Security Act. Which language I reproduce along with some other pieces explaining the current makeup of the Trustees. With any bolding mine.

(c) With respect to the Federal Old-Age and Survivors Insurance Trust Fund and the Federal Disability Insurance Trust Fund (hereinafter in this title called the “Trust Funds”) there is hereby created a body to be known as the Board of Trustees of the Trust Funds (hereinafter in this title called the “Board of Trustees”) which Board of Trustees shall be composed of the Commissioner of Social Security, the Secretary of the Treasury, the Secretary of Labor, and the Secretary of Health and Human Services, all ex officio, and of two members of the public (both of whom may not be from the same political party), who shall be nominated by the President for a term of four years and subject to confirmation by the Senate. A member of the Board of Trustees serving as a member of the public and nominated and confirmed to fill a vacancy occurring during a term shall be nominated and confirmed only for the remainder of such term. An individual nominated and confirmed as a member of the public may serve in such position after the expiration of such member’s term until the earlier of the time at which the member’s successor takes office or the time at which a report of the Board is first issued under paragraph (2) after the expiration of the member’s term. The Secretary of the Treasury shall be the Managing Trustee of the Board of Trustees (hereinafter in this title called the “Managing Trustee”). The Deputy Commissioner of Social Security shall serve as Secretary of the Board of Trustees. The Board of Trustees shall meet not less frequently than once each calendar year. It shall be the duty of the Board of Trustees to—
(1) Hold the Trust Funds;
(2)[11] Report to the Congress not later than the first day of April of each year on the operation and status of the Trust Funds during the preceding fiscal year and on their expected operation and status during the next ensuing five fiscal years;
(3) Report immediately to the Congress whenever the Board of Trustees is of the opinion that the amount of either of the Trust Funds is unduly small;

(4) Recommend improvements in administrative procedures and policies designed to effectuate the proper coordination of the old-age and survivors insurance and Federal-State unemployment compensation program; and
(5) Review the general policies followed in managing the Trust Funds, and recommend changes in such policies, including necessary changes in the provisions of the law which govern the way in which the Trust Funds are to be managed.

Now I am not saying that this clear violation of law on the part of the Trustees and by extension the President is some sort of ‘High Crime and Misdimeanor’. On the other hand you would think the minimum necessary would be SOME accouncement of the very fact of the delay and maybe some hint as to when the Report would be released. Instead current practice is just to have it come out when it comes out, as if this Report, which BTW is coincident with the Report of Medicare, is just some minor program like a Beef Advisory Board. Rather than a program whose costs amount to 5% of GDP (from Social Security alone).

When the Report does release you will be able to find it here: http://www.ssa.gov/oact/tr/ and of course summarized and excerpted at Angry Bear. Hopefully sometime before the statutory release date of the NEXT one. In the meantime I guess this can be treated as a Social Security Open Thread.

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Social Security: 2 Programs, 3 Projections, 3 Actuarial Periods

Table IV.B4 Extract

(Update: the numbers in the above Table represent the present payroll gap. That is an immediate increase in FICA equalling any negative number would fund its respective program over that given period under that set of assumptions). (Update 2…a quirk in the comment section preventing viewing the chart on landing page is fixed…Dan)

The standard way to Report the long-term challenges facing Social Security is by the Long Term Actuarial Gap for combined OASDI under the Intermediate Cost Alternative, which is to say over 75 years and combining the Old Age/Survivors and the Disabled programs together under the Social Security Actuary’s Office’s best median guess as to future demographic and economic numbers. Others say that is not even long enough and say that we should actually examine those numbers over the Infinite Future Horizon. And so one or another of those numbers generally get reported in one of three forms: % of GDP, PV of Unfunded Liability, or % Actuarial Gap.

For others, including me, neither of those make sense for current workers, at least not as the end all and be all. Instead it makes more sense to treat these numbers over your expected work life or perhaps your expected time in retirement, which unless you are a very young worker indeed will be less than 75 years. And certainly not realistically measured over the Infinite Future. Plus you might have some doubts about the Intermediate Cost projection, considering it either too optimistic or too pessimistic on one front or another, or perhaps you have heard that the Disability Insurance program is facing a much more immiment crisis than the Old Age Survivors program.

Luckily the Office of the Chief Actuary has your mind in mind and in Table IV.B4 breaks all of this out into 27 possible combinations of the 2 programs plus a combined number, 3 economic and demographic models, and over 25, 50 and 75 year time periods. I took those numbers are rearranged them into a convenient grid as seen above. The point of departure for discussion probably should be the standard number alluded to in the first para: the 75 year actuarial gap for combined OASDI under Intermediate Cost Assumptions. Which can be seen as the middle number in the last row at 2.72%. This is actually a little higher than the number usually cited which for this Report was 2.66%, that is because this particular table has a more stringent definition for balance in that it requires a Trust Fund Ratio of 100 in the last year. But that doesn’t change the discussion a great deal.

Which discussion I will leave to you all for the time being. Noting only that postive numbers indicate positive actuarial balances for the program in question over that period under that assumption and so represent a program that is “fixed” for the period in question.

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