Contrary to what the Associated Press wants the American public to believe, Social Security's finances are not "stressed" by the downturn. It is true that it is now paying out more money in benefits than it takes in from taxes, but this means zero, nada, nothing in terms of the finances of the program. Under the law that governs Social Security's operations, it can pay full benefits as long as it maintains a minimum balance in its trust fund. At present, it has more than $2 trillion in the trust fund, far more than the minimum balance. In fact, because SS collects interest on the bonds in the trust fund it actually is projected to continue to run surpluses even through the crisis. The article notes that the fund is projected face a shortfall after 2037. While there will probably have to be some adjustments made to the program at some point, this has been true in prior decades as well. It is striking how much attention the media devote to comparatively minor problem.
--Dean Baker