Charles Krauthammer

WASHINGTON -- 2042. I do not know if the president's Social Security reform will pass, but if it does not, its demise will be traced to that point in the president's State of the Union address when he warned that the system would go bankrupt in 2042. It was a disastrous moment.
 First, it is hard to rally people to a crisis that you have located 37 years out. People 45 and older figure they will be dead anyway. And younger people have such a short time horizon that 37 years in the future is utterly meaningless. It does not matter if you have young children. A parent with young children can barely imagine them as teenagers, let alone as pre-menopausal 40-somethings.

     Moreover, the new millennium was always a science-fiction idea, and now that we are there, years beginning with a ``2'' still seem fictional. Even 2011, the first boomer retirement year, has a Stanley Kubrick feel; 2042 lies somewhere in the Matrix.

     It gets worse. If 2042 were an actuarially significant date, all of this could be forgiven. The president would simply have to work extra hard on getting us to imagine it. But pointing to a date that will instantly lose 90 percent of the audience is doubly crazy when that date is meaningless. 2042 is the fictional date for the fictional bankruptcy of a fictional trust fund.

     Let's start with basics. The Social Security system has no trust fund. No lock box. When you pay your payroll tax every year, the money is not converted into gold bars and shipped to some desert island, ready for retrieval when you turn 65. The system is pay-as-you-go. The money goes to support that year's Social Security recipients. What's left over is ``loaned'' to the federal Treasury. And gets entirely spent. It vanishes. In return, a piece of paper gets deposited in a vault in West Virginia saying that the left hand of the government owes money to the right hand of the government.

     These pieces of paper might be useful for rolling cigars. They will not fund your retirement. Your Leisure World greens fees will be coming from the payroll taxes of young people during the years you grow old.

Charles Krauthammer

Charles Krauthammer is a 1987 Pulitzer Prize winner, 1984 National Magazine Award winner, and a columnist for The Washington Post since 1985.

Be the first to read Krauthammer's column. Sign up today and receive delivered each morning to your inbox.