This is the Cato Daily Podcast for Tuesday, June 15, 2010. I'm Caleb Brown. Social

securities anticipated finances depend on models. And the models produced by the Congressional Budget

Office and the Social Security Administration

leave out many important factors.

When those demographic trends are considered, Social Security's liabilities explode.

That according to Jagadish Gokala,

Cato Institute Senior Fellow, an author of the new book,

Social Security, a fresh look at policy alternatives.

What are some of the pitfalls in trying to estimate the future finances for Social Security?

There are actually many pitfalls, and some of those pitfalls are actually not appreciated by a lot of people.

The key pitfall, think is that you have a very coarse methodology

that doesn't take into account all of the economic and demographic factors that are relevant to answering the question about

how Social Security's finances are or what the status of the system is, a

financial status of the system going forward.

The two main groups that produce what are used by the government are CBO and the Social Security

administration. That's correct. And the numbers that are used by Congress

predominantly I assume come from CBO. What do their methods leave out

that we ought to be including?

Well, actually, the main agency that Congress looks to

for most budgetary projections, especially over the next 10 years, is the Congressional

Budget Office.

But in evaluating Social Security's financial condition, Congress, knowing that it's an intergenerational program, requires

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