(CNSNews.com) – Social Security ran a deficit of approximately $45 billion in 2011, according to official government figures and CNSNews.com calculations. That figure is slightly lower than the $49 billion deficit the government reported in 2010.
Social Security had been projected to run a $46 billion deficit in 2011, according to the 2011 report from the program’s trustees that covered 2010.
According to Social Security Administration (SSA) figures, the program was in the red eight months out of the year, and needed to draw on its trust fund in order to pay benefits. The average deficit during those months was $6.3 billion.
SSA data indicate that the program paid out approximately $714 billion in benefits during 2011 while taking in $669 billion in payroll taxes – a deficit of $45 billion.
The deficit figure is preliminary, however, because SSA only reported estimated benefit payments for October, November, and December of 2011. The final deficit figure could therefore be slightly higher or lower, depending on the final benefit figures for those three months.
The estimated benefit payment figures for the last three months of 2011 are lower on average than the actual benefit payments SSA reported. If the final figures for October, November and December end up being closer to those of benefit payments made throughout the year, then Social Security’s deficit for 2011 would be higher than the $45 billion estimate.
This will be the second year since 1983 that the program has run a cash deficit, a trend its trustees expect to continue until the program completely exhausts its trust funds in 2036.
Social Security is in fact already insolvent because its trust funds are invested in non-marketable Treasury bills, not in real assets. In other words, the trust funds contain no cash or other assets, merely special Treasury bonds indicating that one government account – the Treasury’s General Fund – owes another government account – the Social Security trust funds – money.
Both the principal and the interest on those special bonds are paid out of General Fund tax revenue – the same as with any other government spending program.