Washington Post staff writers Michael A. Fletcher and Jim VandeHei quoted Sen. John McCain (R-AZ) in a March 23 article falsely asserting that in 2042, "we stop paying people Social Security," but failed to correct his erroneous claim. The Post also wrongly attributed to unnamed "opponents" of Social Security privatization the inaccurate view that "the system's core problem" is that "benefit payments are estimated to surplus tax receipts by 2018."
In fact, though the Social Security trustees predict that the system's trust fund will be exhausted in 2042, the program will still be taking in new revenue from payroll taxes at that point. According to the 2004 report of the Social Security trustees, even if no changes are made to current law, "Present tax rates would be sufficient to pay 73 percent of scheduled benefits after trust fund exhaustion in 2042 and 68 percent of scheduled benefits in 2078." Because scheduled benefits are expected to rise faster than inflation, 73 percent of benefits scheduled for 2042 would still be greater, in real terms, than the benefits that today's retirees receive.
Media Matters for America has noted that NBC anchor Brian Williams last month failed to correct a similar claim by McCain.
VandeHei and Fletcher also attributed an incorrect view to unnamed "opponents" of Social Security privatization, claiming that these opponents believe that "the system's core problem" is that "benefit payments are estimated to surpass tax receipts by 2018." In fact, many opponents of privatization recognize that 2018 is barely relevant to the crucial issue of Social Security's long-term solvency. Though outlays will exceed annual payroll tax revenues beginning in 2018, the accumulation of assets in the trust fund since 1983 will enable Social Security to pay promised benefits in full until at least 2042.
Updated projections on Social Security's long-term solvency were released March 23 in the 2005 Annual Report of the Board of Trustees of the Federal Old-Age and Survivors Insurance and Disability Insurance Trust Funds, after McCain's comments were made and the Post article was published. In the new report, the trustees project that benefit payments will surpass tax receipts by 2017 and that the trust fund will be exhausted in 2041.