Sick and getting sicker, Social Security will run at a deficit this year and keep on running in the red until its trust funds are drained by about 2037, according to bleaker-than-previous estimates from congressional budget experts. The massive retirement program has been suffering from the effects of the struggling economy for several years. It first went into deficit last year but had been projected to post surpluses for a few more years before permanently slipping into the red in 2016.
This year alone, Social Security will pay out $45 billion more in benefits than it collects in payroll taxes, the nonpartisan Congressional Budget Office said. That figure nearly triples—to $130 billion—when the new one-year cut in payroll taxes is included. The projected deficits add a sense of urgency to efforts to improve Social Security's finances. For much of the past 30 years, the program has run big surpluses, which the government has borrowed to spend on other programs. Now that Social Security is running deficits, the federal government will have to find money elsewhere to help pay for benefits.