It looks like you're using an Ad Blocker.
Please white-list or disable AboveTopSecret.com in your ad-blocking tool.
Some features of ATS will be disabled while you continue to use an ad-blocker.
Big job losses and a spike in early retirement claims from laid-off seniors will force Social Security to pay out more in benefits than it collects in taxes the next two years, the first time that's happened since the 1980s.
The deficits — $10 billion in 2010 and $9 billion in 2011 — won't affect payments to retirees because Social Security has accumulated surpluses from previous years totaling $2.5 trillion. But they will add to the overall federal deficit.
Applications for retirement benefits are 23 percent higher than last year, while disability claims have risen by about 20 percent. Social Security officials had expected applications to increase from the growing number of baby boomers reaching retirement, but they didn't expect the increase to be so large.
What happened? The recession hit and many older workers suddenly found themselves laid off with no place to turn but Social Security.
"A lot of people who in better times would have continued working are opting to retire," said Alan J. Auerbach, an economics and law professor at the University of California, Berkeley. "If they were younger, we would call them unemployed."
Job losses are forcing more retirements even though an increasing number of older people want to keep working. Many can't afford to retire, especially after the financial collapse demolished their nest eggs.
Some have no choice.
Nancy Rhoades is just 56, so she won't be eligible for retirement benefits for six more years. She's pretty confident she would qualify for disability benefits, but would rather work.
"You don't think of things like this happening to you," she said. "You want to be in a position to work until retirement, and even after retirement."
Half of America's private sector workforce has no employer-sponsored retirement plan; among the half that does, twice as many workers have contribution plans like 401(k)s than have lifetime pensions, a complete reversal from 25 years ago. The move from lifetime pensions to 401(k) plans has meant that employees now bear much more of the cost -- and risk -- for saving for retirement. According to the U.S. Department of Labor, in 1978 workers put in only 11 percent of total contributions to retirement plans, while corporations put in 89 percent; by 2000, the employee share had leapt to 51 percent and the company share had fallen to 49 percent.
..The latest scam from the BLS is that the subsidy in the “Cash for Clunkers” program will be deducted from the CPI.
This is being done to artificially reduce the CPI and reduce pension payout, as well as Social Security payout. ...
This follows the news from this weekend that Congress approved $93,000 more in petty cash for each member. The Omaha World-Herald reported:
The nation's financial picture has been grim for months, but don't worry about lawmakers on Capitol Hill.
They just got a $4,700 raise.
The 2009 annual salary for rank-and-file senators and representatives is $174,000, up from last year's $169,300.
The legislative pay hike comes as major U.S. employers shed jobs by the tens of thousands. Many worker salaries have been frozen or cut. Their benefits often have been slashed.
Families are pinching pennies and watching retirement accounts evaporate.In this decade, Congress has allowed the pay increase to go through for every year except 2007. The percentage increase is tied to private-sector wages and cannot be more than increases granted to general federal employees.
Under this bipartisan system, lawmakers are protected from ever having to vote to raise their own pay. The system, adopted in 1989, allows members of Congress to prevent a challenger from using a pay-raise vote against them at election time.