But those who insist that we face a Social Security crisis want to have it both ways. Having invoked the concept of a unified budget to reject the existence of a trust fund, they refuse to accept the implications of that unified budget going forward. Instead, having changed the rules to make the trust fund meaningless, they want to change the rules back around 15 years from now: today, when the payroll tax takes in more revenue than SS benefits, they say thats meaningless, but when in 2018 or later benefits start to exceed the payroll tax, why, thats a crisis. Huh?
Let me get this straight…
Alternative universe A: There is no demographic crunch and there won’t be fewer workers to support more pensioners. Thus Krugman is right, let’s not worry about social security.
Alternative universe B: There is an impending crunch but it doesn’t matter because social security isn’t a pay-as-you-go system. Thus Krugman is right, let’s not worry about social security.
According to Krugman, its ok to ignore problems when we can lump them in with a whole lot of other problems (i.e. treating SS as a line item in the general budget). Meaningless.