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Full calendar year 2011 numbers are now available to calculate the results for the Social Security Trust Fund. Here's a look at the key numbers that will be reported to Congress in four months:

Payroll Tax Revenue: $669B ($642B - 2010)
Benefit payments: $726B ($702B - 2010)
Primary Deficit: $57B ($60B - 2010)
Other cash components at SSA:
Tax on benefits: $23B (2010 - $24b)
Payments to R.R. Retirement: $4.6B ($4.4B - 2010)
Overhead: $7.0B ($6.5B - 2010)
Net 2011 cash drain: $46B ($49B - 2010)
Non cash items
Interest: $116B ($117.5B - 2010)
Paper surplus: $70.0B ($68.5B - 2010)

The reported numbers will show a very small improvement ($3B ) in the net cash drain. This may cause some to look at the 2011 results and say, “See! Things are stabilizing and even getting better!” Let me try to blunt any enthusiasm in advance.

SSA measures (A) actual monthly cash receipts and then (B) makes assumptions about what additional amounts are coming in based on a series of macro assumptions (GDP, employment/unemployment, etc.). The Treasury Department pays SSA the sum of A+B. Ultimately all of the money is accounted for and any adjustments (plus or minus) are reflected in the next year's results.

This system works pretty well as the annual adjustments have been fairly modest and the adjustments have been both positive and negative. That was not the case in 2009. The models that SSA uses significantly overestimated tax revenues in that year. As a result, there were very significant downward revisions to the actual receipts that were reported in 2009. Following is a slide of SSA’s monthly 2010 revenues. Note that the revisions to FICA and SECA from the prior years totaled $28B. (2009 and 2011 also have significant prior year adjustments.)



To regularize the data for the big accounting changes it is necessary to add/subtract the adjustment from the prior year and then look forward to what overstatements/understatements were made in the then current year. When the ins and outs are made, the results for the regularized FICA/SECA revenue numbers are as follows:

2005....$521B
2006....$553B
2007....$585B
2008....$615B
2009....$676B
2010....$702B
2011....$726B

The following chart shows adjusted Payroll Tax revenues minus Benefit Payments:



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