CBO: Social Security will be solvent longer than Bush administration projected
The long-term outlook for Social Security is less dire than the Bush administration had projected, according to the Congressional Budget Office. The CBO said Monday in its first comprehensive analysis of Social Security's finances that the fund would be solvent until 2052. This is a full decade later than the Bush administration's March report that forecasted 2042 as the end date.
The CBO said Social Security is currently running a surplus, but as baby boomers retire, outlays will grow faster than revenues. That will lead to annual deficits starting in 2019, the report said.
The Bush administration estimated the program's long-range deficit - the difference between revenue and outlays over the next 75 years - at 1.9% of the nation's taxable payroll in that period. By contrast, the budget office put the long-range deficit at 1% of taxable payroll, according to the New York Times.
While the administration's estimates were prepared largely by government actuaries and civil servants, the Congressional Budget Office developed its own Social Security model. The model assumed that earnings and productivity would grow faster than the administration's assumptions and that inflation would be lower and interest rates higher.