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WaPo Ignores Social Security’s Deficits

In an otherwise fine piece of reporting on the continued flight of wordlwide investment into the safety of U.S. Treasury bonds, The Washington Post’s Neil Irwin reports:

Perceptions inside the Beltway rest on this idea: Although the current large budget deficit is caused mainly by the weak economy and a short-term economic stimulus that will soon expire, in the longer run the government faces a vast unfunded burden, particularly tied to Medicare and Medicaid.

It is true that Medicare’s $37.9 trillion unfunded liability is a driver of long term U.S. deficit concerns, but one cannot ignore Social Security’s problems either.

In fact, thanks to the recession Social Security is already in the red and, after a brief reprieve if the economy recovers, is set to go back into the red forever. All told Social Security owes $7.7 trillion more in benefits than it will receive in taxes.

$7.7 trillion is far less than Medicare’s $37.9 trillion hole, but still large enough to warrant a mention.