Social Security and the federal budget are not the same problem – I think somebody at the Boston Globe is trying to drive me crazy with this deeply flawed editorial about my least-favorite entitlement program. The Globe tries to conflate the federal budget with the Social Security program and only confuses the issue.

Social Security is a stand-alone program with a trust fund full of U.S. Treasury bonds, the safest investment in the world. When payments start to outstrip receipts, the trust fund will start cashing in T-bills and they will be paid. The government will raise taxes or borrow more, but the debt must be paid.

The heart of the problem is that Social Security’s health is dictated by demographics, which simply cannot support the system indefinitely. The Trust Fund will be spent by around 2040 and then all recipients will see automatic 27% benefit cuts. The program currently shows an investment return rate of 1%; a rate that drops into negative the closer we get to bankruptcy. In other words: forget about the federal deficit with regard to Social Security. The entitlement is already inequitable enough by taking a lifetime of taxes for a pittance, if you survive.