NEW YORK (CNN/Money) -
In his State of the Union address Wednesday evening, President Bush encouraged lawmakers "to join together to strengthen and save Social Security." But in making his case for why an overhaul is needed now, he may have overstated Social Security's problems.
"By the year 2042, the entire system would be exhausted and bankrupt," the president said. He also appealed to parents: "If you've got children in their 20s ... the idea of Social Security collapsing before they retire does not seem like a small matter."
But it's not necessarily accurate to characterize the system in that way, say three nonpartisan sources that have closely examined Social Security -- though they do agree the system is facing genuine financial challenges that are better addressed sooner rather than later.
If you define "bankrupt" as not being able to pay your obligations in full, then you might argue Social Security will be bankrupt come 2042, using projections from the Social Security trustees, or 2052, using estimates from the Congressional Budget Office.
By that logic, though, you also might argue that the U.S. government - with its roughly half-trillion-dollar deficit -- is or will be bankrupt, said Ron Gebhardtsbauer, a senior pension fellow with the American Academy of Actuaries.
Polls indicate a significant number of Americans believe "bankrupt" means penniless. But, come 2042 (or 2052), the system is expected to be taking in enough revenue to cover 75 percent to 80 percent of what is currently promised to future retirees.
Even at that reduced rate, the benefits still would be higher in today's dollars than what current retirees are getting, according to CBO estimates.
Whatever happens, "the program will never go bust," said David Walker, comptroller general of the General Accounting Office, in an interview with CNN economics correspondent Kathleen Hays. (For a look at Walker's take on the system's financial challenges, click here.)