Rep. Maloni: My question was the statement by 2042, the entire system will be bankrupt. It will not be bankrupt, I agree the trust fund will be gone, but there will still be the money coming in from the payroll taxes -- enough to pay, by all accounts, three-quarters of the benefits. Is that true or not?
Chairman Greenspan: It's true in dollar terms, but I suspect it may not be true in real terms. And the reason I'm saying that: if we cannot get full funding and the savings required to build up the capital stock in time for 2042's production of goods and services, yes, the individuals may have the cash, but the cash will not buy as much as they think it would be. The real problem has got to be real resources, and this issue of whether or not the OASI goes bankrupt or not bankrupt is an interesting legal and political question, but it really doesn't get at the economics of the retirement of individuals, the 30 million additional individuals.
Rep. Maloni: That's true, but the point is, in 2042, the entire system is not bankrupt.
8 hours ago
1 comment:
Wow, a whole 3/4 of the promised benefits! Obviously there's no political problem here!
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