SOCIAL SECURITY: Long-Term Financing Shortfall Drives Need for Reform
GENERAL ACCOUNTING OFFICE WASHINGTON DC
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Social Security not only represents the foundation of our retirement income system it also provides millions of Americans with disability insurance and survivors benefits. As a result, Social Security provides benefits that are critical to the current and future well-being of tens of millions of Americans. The system faces both solvency and sustainability challenges in the longer term. Although the Social Security Trustees now project that under the intermediate or best estimate assumptions the combined Social Security Trust Funds2 will be exhausted 3 years later than in last years estimates, the magnitude of the long-term funding shortfall is virtually unchanged. In their 2002 report, the Trustees emphasized that while the programs near-term financial condition has improved slightly, Social Security faces a substantial financial challenge in the not-too-distant future that needs to be addressed soon. In essence, the programs long-term outlook remains unchanged. Without reform, Social Security, Medicare, and Medicaid are unsustainable, and the long-term impact of these entitlement programs on the federal budget and the economy will be dramatic.
- Economics and Cost Analysis