Many Americans believe that the Social Security System cannot run a deficit but the fact is that Social Security is running a cash deficit today, and will keep running deficits until its trust funds run out. Michigan State University Extension discusses the difference between a cash flow deficit and going into debt (e.g. borrowing).

Social Security is legally barred from going into debt, spending more than it takes in over the life of the program, but it can run a deficit, spending more than it takes in during a single year. In 2014, for example, Social Security ran a cash-flow deficit of $73 billion. According to Operations of the Combined OASI and DI Trust Funds,

in Current Dollars, over the next decade, the trustees project cash-flow deficits of $1.3 trillion, and CBO projects deficits of $2 trillion. Even including interest income, the program is projected to begin running deficits by 2017 or 2020. 

Because the Social Security trust funds currently hold $2.8 trillion in reserves, the program is projected by the Trustees to continue to run “annual deficits for every year of the projection period” until the trust funds are depleted in 2034. At that point, current law bars Social Security from paying benefits beyond what is collected in revenue.

Other articles in this series: 

• The future of the Social Security system: Part one
• The future of the Social Security system: Part two
• The future of the Social Security system: Part three
• The future of the Social Security system: Part four
• The future of the Social Security system: Part five
• The future of the Social Security system: Part six
• The future of the Social Security system: Part seven

• The future of the Social Security system: Part eight

• The future of the Social Security system: Part nine