The COVID-19 Pandemic and Its Impact on Social Security Funding

With just about everyone distracted by the COVID-19 pandemic, news about America's social safety net does not particularly garner any attention.  Nonetheless, on April 22, 2020, the Bipartisan Policy Center released its latest analysis on the state of America's Social Security system and how the COVID-19 pandemic will negatively impact the plan's financial health.

Let's start by looking at the most recent analysis of the fiscal health of the nation's Social Security trust funds as found in this report:

As it stands now, the lion's share of the money paid out as both retirement and disability benefits from the Social Security system comes from payroll taxes with a small amount of income from the taxation of benefits and interest earned on securities held by the trust funds.  Here is a table showing the payroll tax contribution rates for 2019:

According to the 2020 Annual Report of the Board of Trustees of the Federal Old-Age and Survivors Insurance and Federal Disability Insurance Trust Funds, the OASDI program was paying benefits to 64 million people of which 48 million were retired workers, 6 million were survivors of deceased workers and 10 million disabled workers and their dependents.  While the Old Age and Survivors Insurance or OASI and Disability Insurance or DI are generally expressed as a single entity, OASDI, in fact, by law, the two funds are separate entities meaning that combined fund operations and reserves are hypothetical.   The total cost of the programs in 2019 was $1.059 trillion and total income was $1.062 trillion ($981 billion in non-interest income and $81 billion in interest earnings).  At the end of fiscal 2019, the plan had asset reserves (in U.S. Treasuries) of $2.897 trillion.  That said, under the Trustee's assumptions, Social Security's total cost is projected to be less than its total income in 2020 but higher than its total income in the years between 2021 and 2029.  Social Security's costs have exceeded its non-interest income since 2010.  According to the Trustee's calculations, the combined reserves of OASDI are projected to decrease from the current $2.897 trillion at the beginning of 2020 to $1.819 trillion at the end of 2029.  According to the Trustees' analysis, by 2035, the OASDI combined reserves will be completely exhausted with OASI reserves being exhausted in 2034 and DI being exhausted in 2065.  This could result in a significant cut in benefits.

Here is a graphic showing the declining cumulative value of the OASDI Trust Funds:

With that background, let's look at the analysis by the Bipartisan Policy Center.  BPC notes that the following changes have taken place since the COVID-19 pandemic began:

1.) Laid off workers do not pay payroll taxes (and neither do their employers) into the Social Security system.

2.) Workers that have seen their hours cut may also result in depressed payroll tax revenue since Social Security recipients pay taxes on their benefits only if their incomes exceed $25,000 ($32,000 for a couple filing jointly).  As well, retired beneficiaries have seen their interest income slashed thanks to the ultra-low interest rates adopted by the Federal Reserve in response to the COVID-19 pandemic, meaning that they will more likely find that their benefits will not be taxed.

3.) The aforementioned cut in interest rates by the Federal Reserve means that the Social Security trust funds will receive less interest income on the OASDI trust funds.

BPC analysts then look at what would happen to Social Security trust funds if (when) another recession takes place, using several variants of what happened during the Great Recession.  Here are the key assumptions:

1.) Over the next 10 years, Social Security revenue and excess costs from additional claims of retirement and disability benefits change as they did over the ten years between 2008 and 2017.  

2.) Adjustments were made for the added cost of higher numbers of older Americans claiming retirement benefits to reflect the growing number of Baby Boomer retirees since 2008. 

3.) Since the CARES Act temporarily increased unemployment insurance payments, the analysis assumed that disability insurance claims may not rise by as much as they did during the Great Recession.

4.) Since the coronavirus is likely to result in the deaths of higher number of senior Americans who will stop receiving Social Security benefits, the analysis uses an estimate of the number of seniors who will no longer receive Social Security because they are deceased.

Here is a graphic showing the OASDI end-of-year Trust Fund balance for two scenarios; one without the impact of the COVID-19 pandemic (baseline scenario) and one including the impact of the COVID (i.e. another Great Recession):

Here is a similar graphic showing the OASI end-of-year Trust Fund balance:

As you can see, the BPC analysis shows the following:

In the absolute worst-case scenario with a recession twice as severe as the Great Recession, the DI reserves would be depleted in 2022 and the OASDI combined reserves would be depleted in 2026.  

While we have no idea of the mid- and long-term impacts of the COVID-19 pandemic on the economy as a whole, at the very least, the prospect of a recession similar to that experienced in 2008 will result in the fiscal collapse of the Social Security Trust Fund.  Unless Washington moves quickly to address this financial imbalance, Americans of all ages will find themselves impacted by higher taxes, dramatic decreases in government-funded retirement and disability benefits or some combination of the two.  Thanks to the government's response to the COVID-19 pandemic, the pain is coming, it's just a matter of when.

Another fine example of an unintended consequence.

The Collapse of the Social Security Ponzi Scheme

While Capitol Hill's denizens frequently discuss how their budgetary changes are going to impact the taxes paid by Main Street and Corporate America, they rarely mention the impact of these changes on the entitlements that most Americans feel are their birthright.  This is particularly the case for the nation's Social Security system, a key part of retirement funding for tens of millions of Americans.  Thanks to the Committee for a Responsible Federal Budget (CRFB), we have a glimpse into what lies ahead for this key aspect of life in the United States.

Let's open this posting with a graphic from another one of the CFRB's studies showing how the population in the United States is projected:

As you can see, the number of Americans 65 years of age and older is projected to more than double from around 50 million currently to over 100 million in 2070.  Obviously, this is going to put a strain on age-based entitlement programs.

According to CRFB's analysis of the 2017 Social Security Trustees Report, we find the following:

1.) On a combined basis, the Old-Age, Survivors and Disability Trust Funds (OASDI) face a theoretical 75 year shortfall of 2.83 percent of taxable payroll or 1.01 percent of Gross Domestic Product and will be insolvent by 2034.

2.) Social Security will pay out $27 billion more in benefits than it receives in tax revenue this year.

3.) Social Security will generate cash flow deficits of $1.4 trillion over the next 10 years and $4.9 trillion over the following decade as shown here (as a percentage of payroll):

Social Security deficits will reach 1.36 percent of GDP by 2037 and 1.54 percent of GDP by 2091.  

4.) On a present value basis, the program's 75 year  unfunded obligation will reach a total of $12.5 trillion.

5.) The Social Security Disability Insurance (SSDI) trust fund will deplete its reserves in 2029, the Old Age and Survivors Insurance Trust Fund (OASI) will be depleted in 2035 and, on a combined basis, the OASDI trust fund will run out of reserves by 2034 as shown on this graphic:

Here is an interesting table showing how the OASI funding has changed over the period from 1937 to 2016, noting in particular the dropping "net increase":

In the current legal environment, if a trust fund becomes depleted, there is a conflict between two federal laws.  Under the Social Security Act, beneficiaries are still entitled to receive their full scheduled benefits.  Under the Antideficiency Act, governments are prohibited from spending an excess of available funds.  This means that the Social Security Administration would not have legal authority to pay full Social Security benefits.  After insolvency, Social Security would continue to receive tax income which would allow it to pay out a majority of scheduled benefits.  According to a study by William Morton and Wayne Liou at the Congressional Research Service, Congress could restore Social Security's fiscal balance by one of two means with actions taking place in 2034:

1.) Reducing scheduled benefits by 23 percent in 2034 with the reduction in benefits growing to 27 percent by 2091 as shown here:

A benefit cut of 23 percent in 2034 will look like this:

a.)  Newly retired 62 year olds (in 2017) would see a cut in benefits of $3700 per year in 2034.

b.) A beneficiary that reached full retirement age (67) in 2033 will see a cut in benefits of $5800 per year (in today's dollars) in 2034.

2.) Raising the Social Security payroll tax from 12.4 percent to 16 percent following insolvency in 2034 and then gradually increase it to 16.9 percent by 2091 as shown here:

With a significant proportion of state and private pension plans underfunded and the funding issues facing the Social Security scheme, it is looking increasingly like the pension Ponzi scheme has finally   reached the point where it will collapse under the weight of the aging American population.  If Congress hopes to achieve any sort of fiscal balance in the Social Security scheme, they will have to act quickly to phase in either cuts in benefits, increases in payroll taxes or some combination of the two.  The longer that Congress waits to take what will surely be unpopular action on the looming Social Security time bomb, the worse the situation will become.  Instead of focussing on this issue that is of great importance to the vast majority of Americans, Congress seems to be focussing its energies on the current Donald Trump reality television show that has taken over Washington since the 2016 election.

The Impact of Longevity and Income Level on Social Security Benefits

A recent study by the Government Accountability Office (GAO) looks at how changing life expectancy is projected to have a significant impact on Social Security benefits.  Increases in life expectancy go hand-in-hand with increased lifetime benefits from Social Security, however, this study shows that there are significant differences in lifetime benefits when income level is taken into account.  In this posting, we will look at the Social Security program in two parts; first, the overall funding issues facing the Social Security Administration followed by a look at how both longevity and income level play a role in a person's lifetime Social Security benefits.   

Let's open this posting with some background information on the Social Security system and the funding problems that face it.  According to the Social Security Administration, 94 percent of American workers had jobs that would make them eligible to receive Social Security retirement benefits in the future.  In 2014, approximately 39 million retired workers were receiving Social Security benefits which are based on an individuals average indexed monthly earnings.  Retired workers with lower average career earnings receive monthly benefits that average about 50 percent of what they were earning while they were working whereas workers with higher average career earnings receive benefits that equal about 30 percent of earnings.  Social Security pays unreduced benefits ages ranging from 65 to 67 depending on one's birth year and benefits can be claimed as early as age 62 which results in a reduced monthly payment.  In 2014, 37 percent of total retired worker benefits were awarded at age 62, the most common age to collect Social Security benefits.  

Let's now look at the future funding problems for Social Security.  Under the current scenario, it is obvious that the increase in lifespan and the number of Social Security recipients is going to prove problematic.  A 2015 study by the GAO entitled Social Security's Future noted that the fraction of older Americans (65 years plus) would look like this in the coming decades:

...that labor force growth (i.e. workers that fund Social Security through payroll deductions) would look like this:

...and that Social Security spending was projected to increase from 4.9 percent of GDP to 6.1 percent of GDP over the next 25 years.  This means that roughly 33 cents of every dollar of federal tax revenue will be spent on Social Security.  

Here is a graphic showing how the revenues from the Old-Age, Survivors and Disability Trust Funds have and will continue to run deficits into the future:

As it stands now, over the next 75 years, the Social Security system funding gap is estimated to be $10.7 trillion or slightly more than half of the current federal debt.  As well, by 2035, the Old Age and Survivors Insurance (OASI) trust fund will be depleted, meaning that Social Security payments will have to rely on outside revenues to continue paying just over three-quarters of scheduled benefits.

Now, let's look at how life expectancy in the United States has changed over the past decades and how income levels will impact the lifetime level of Social Security benefits that a recipient receives.  In 1915, on average, a man who was 65 could expect to live until age 79.7 and a 65-year-old woman could expect to live until she was 83.7 years of age.  By 2015, this had changed to 86.1 years for men and 88.7 years for women, an increase of 6.4 years for men and 5 years for women.  That said, there are wide disparities in life expectancy across the nation with the lowest life expectancy being found in the South, the Mississippi basin, West Virginia, Kentucky and selected counties in the West and Midwest.  This is largely due to environmental factors including a lack of access to health care and behaviours including poor diet, a lack of exercise and smoking but is also related to income level.  On average, lower income males live between 3.6 and 12.7 fewer years (depending on their birth year) and lower income worm live between 1.5 and 13.6 fewer years than their wealthier counterparts.  This has a significant impact on the projected remaining years of life for men after age 65 as shown on this graphic:

Obviously, this is also going to have an impact on the total amount of Social Security benefits received during a recipient's lifetime.  Lower income Americans who have a shorter lifespan will receive less Social Security benefits over their lifetime than their wealthier peers as shown on this graphic:

Sadly, it is these lower income Americans who rely heavily on Social Security benefits to fund their retirement years since they are less likely to be covered by company pension plans or have any significant amount of retirement savings.  It is also this same group that is likely to take Social Security benefits early and suffer the penalty of lower monthly payments.

It is pretty obvious that the Social Security system is in trouble and that it requires significant changes if it hopes to meet its obligations in the future.  The fact that the current crop of presidential candidates is rather non-committal on the changes necessary to ensure its future and enable lower income Americans to rely on Social Security to fund their retirements should be of concern to voters of all political persuasions.

The Experimental Consumer Price Index

The Bureau of Labor Statistics releases its monthly Consumer Price Index (CPI) data each month, a measure that most of us think of as the rate of inflation.  The CPI measures the average change in prices over time for a fixed market basket of goods and services.  The CPI can be divided into two parts; the CPI for All Urban Consumers or CPI-U which represents the spending habits of about 80 percent of Americans and its subset, the CPI for Urban Wage Earners and Clerical Workers or CPI-W which represents the spending habits of about 32 percent of all Americans.

Under the Older Americans Act of 1987, the BLS also calculated a little-known experimental price index called the Consumer Price Index for the Elderly or CPI-E which measures the spending habits of Americans aged 62 and older.  The population used in this measure had to meet one of these three conditions:

1.) They had to be unattached individuals who were at least 62 years of age.

2.) They had to be a member of a family whose reference person or spouse was at least 62 years of age.

3.) They had to be a member of a group of unrelated individuals who live together and pool their resources to meet their living person whose reference person was at least 62 years of age.

Obviously, older Americans spend money differently than their younger counterparts, particularly when it comes to expenditures on medical care and shelter as shown in this table which compared the percent of average annual expenditures on various components by age as compared to what is spent by average Americans as a whole:

Originally, the study of the experimental CPI-E covered the time period from December 1982 to December 1987 and was then expanded to cover the period up to December 1993.  The result of the expanded study were covered in a paper by Nathan Amble and Kenneth Stewart.  At that time, they found that, over the period from December 1987 to December 1993, the experimental price index or CPI-E rose by 28.7 percent, higher than the 26.3 percent increase for the CPI-U and 25.5 percent increase for the CPI-W.  When the data was examined more closely, the authors found that the biggest price increases for the elderly were found in medical care; during the six year period, the cost of medical care rose more than twice as fast as the average for all items in each population group, rising at 59.4 percent between 1988 and 1993 for the elderly, compared to 54.2 percent for the broadest measure of consumers (CPI-U).  

Here is a table showing how each of the three CPI measures looked during the period from 1988 to 1993:

While a few percent here or there may not seem significant, in fact, over decades it adds up as shown on this graph from FRED which shows the most commonly reported CPI-U measure in red and the CPI-E measure for older Americans in blue:

Over a period of decades, it is quite obvious that the cost of living for older Americans has risen substantially above their younger counterparts.

What are the real world consequences of this difference?  Right now, Social Security benefits increase once annually to ensure that older Americans do not experience a decline in their standard of living as a result of rising prices.  These increases are tied to the CPI-W which reflects the spending habits of all American urban wage earners and clerical workers.  Obviously, the purchasing patterns of retirees differ significantly from their younger counterparts and, as noted above, inflation for older Americans is higher than for their younger counterparts.  While several attempts have been made to change this policy, none have succeeded.

While it is somewhat dated, a 2003 study by Burt Hobijn and David Lagakos looks at what would happen to the social security trust fund, officially known as the Old-Age and Survivors Insurance (OASI) trust fund.  Obviously, since inflation is higher for older Americans, using the CPI-E rather than the CPI-W would mean that payouts from the OASI trust fund would be higher.  The authors used two different scenarios; the first assumed that CPI-E was 0.22 percent higher and the second assumed that CPI-E was 0.38 percent higher than CPI-W.  Here is a chart showing three scenarios; the trust fund's declining balance under the current CPI-W projections and the trust fund's declining balance under the two CPI-E projections with the year along the horizontal axis and the funding ratio along the vertical axis:

If the CPI-E was adopted and inflation rate for seniors was 0.22 percent higher in each year, the fund would become insolvent in 2041, two years before the projected insolvency date of 2043.  If the inflation rate for seniors was 0.38 percent higher in each year, the fund would become insolvent in 2038, five years earlier than under the current scenario.

Given that senior Americans have experiencing consistently higher levels of inflation over the past three decades, policymakers have a difficult decision to make, particularly in light of the aging population.  They can either maintain the purchasing power of senior citizens or they can prolong the solvency of the social security trust fund.

Social Security - Will it survive and will we recognize it if it does?

A recent study of the American Social Security program by the Brookings Institution in Washington, DC, was published in the June 2011 edition of the National Tax Journal. The author of the article entitled “Social Security Reconsidered”, Henry J. Aaron, outlines the issues facing Social Security, a subject that is of particular interest in this time of rising federal debt and deficits.

Social Security was designed to assure a basic income for those Americans who have retired (Old Age), death benefits to the bereaved (Survivors) and financial support for the disabled (Disability Insurance), all indexed for inflation.  This is coverage that is not and was not generally available in the private domain.  For the fiscal year 2011, outlays from the Social Security program are expected to reach $750 billion, the largest domestic spending program in the federal government.  In 2008, the recipients of funds from this entitlement program received half or more of their income from Social Security and a rather surprising 22 percent received all of their income from Social Security.  Some economists have determined that the impact of the Social Security "blanket" has wide reaching impacts on the economy by affecting the individual savings rate.  Obviously, it is a much used and greatly needed support program for Americans over the age of 65.  Unfortunately, in the future, it appears that the "security" part of this social program may well not exist.

When the Social Security Act was signed into law in 1935 by President Franklin Roosevelt as part of his New Deal program, it was decided to fund the program with payroll deductions (taxes) rather than from general government revenue.  This meant that early beneficiaries collected far more in Social Security benefits that they paid in taxes. Calculations show that beneficiaries born before 1935 have collected and will generally collect more in benefits than they paid in taxes; the difference being funded by those who were born after 1935.  The program is also designed with benefit caps; this provides annual benefits that are larger relative to earnings for low income earners.  On the other hand, high income earners tend to live longer on average than low income earners resulting in larger overall lifetime Social Security benefits (in 1982 this difference was 1.9 years for those who were 65; this rose to 5.3 years for those who were 65 in 2006).  This is somewhat countered by higher Survivor and Disability benefits that are paid to lower income earners.

Social Security actuaries project that spending on this program will rise by 1.2 percent of GDP between the years 2010 and 2030 and then fall by 0.2 percent between 2030 and 2050 as baby boomers die and are replaced by a smaller cohort of seniors because of the slow decline in the birthrate over the past 30 years.  The Congressional Budget Office sees the future slightly differently with Social Security payments reaching 1.8 percent of GDP between 2010 and 2030 and falling to 1.5 percent of GDP between 2030 and 2050.  To put Social Security spending into perspective, the program accounts for 20 percent of all non-interest government spending.  If the federal government wishes to reign in the debt-to-GDP level before it reaches a critical level, overall budget deficits must be controlled before 2030.  While there are proponents for cutting Social Security benefits as part of a package of cost control measures, the author feels that such cuts will not kick in quickly enough to stabilize America's debt-to-GDP level.  

Every year, the trustees of the Social Security program prepare a report outlining their projections for the future of the program that attempt to envisage outlays and revenues for the next 75 years.  These outlays and revenues are expressed as a percentage of payrolls that are subject to the payroll tax that funds the Social Security program.  In 2010, the report stated that revenues would average 14.01 percent of payroll and that outlays (benefits) would average 15.93 percent of payroll over the next 75 years.  Right off, one can readily see that Social Security will be paying out more than it is bringing in as payroll tax revenue by 1.92 percent of payroll.  Kind of reminds me of most government programs today, doesn't it?

Looking back, Congress attempted to close this funding gap back in 1983 through the use of legislation.  Unfortunately, the legislation set revenues to exceed outlays for only the first part of the 75 year projection with the plan of leaving a small residual reserve in the 75th year and deficits in the 76th year and beyond.  That is where the problem cropped up.  As the years have passed (28 of them since 1983), the number of deficit years has increased as the 75 year period rolls forward in time.  As each year passes, an additional deficit year is added to the end of the equation and one less surplus year is left behind at the beginning.  Approximately five-sixths of the gap in funding that is today projected for 75 years in the future is due to the rolling forward of the projection period.  The other one-sixth of the funding gap is due to economic factors, individual disability, new legislation and changes in demography.

Let's examine the role of Social Security in the overall budget deficit scheme.  The Social Security program is funded by a trust fund, a massive $2.6 trillion at the end of 2010.  Funds accumulated within the trust fund grow as their assets accumulate interest earnings.  For that reason, the Social Security trust fund reserves are projected to grow until the year 2025.  At that point, Social Security outlays will begin to exceed revenues from both interest earnings and payroll taxes.  The excess reserves will be exhausted in 2037 and at that point, the gap between what is spent on Social Security and what is taken in will reach 1.3 percent of GDP.  This gap in funding will then be added to America's debt-to-GDP ratio.

Discussions regarding the cutting of Social Security benefits are fraught with hints of political suicide.  Both the Republicans and Democrats have been able to agree on one thing; significant cuts in Social Security should not erode the benefits of current or soon-to-retire beneficiaries because they have less ability to save additional funds to comfortably retire.  It has already been proposed that maintaining current program benefits apply to everyone over the age of 45 or 55.  While this is comforting on one level (to retirees), it is disturbing because it means that it will take longer for funding balance in the Social Security program to take place over the decades to come This will result in less than meaningful reductions to the debt-to-GDP level.

Let’s look at possible changes that could be made to the Social Security program to ensure its future.  First, revenues and benefits must be set at levels that keep the trust fund in balance as shown here:  

1.) Revenues:  Over the next 75 years, the gap between benefits and taxes has a present discounted value of $5.4 trillion or 0.6 percent of GDP.  This compares to the Bush II tax cuts that equaled two percent of cumulative GDP over the 8 years of his Presidency. 

2.) Benefits:  When looking at the level of benefits, the ratio of United States Social Security benefits to cash earnings ratio is in the bottom quarter of 18 of the OECD nations and only two-thirds of the OECD average.  Despite having one of the highest wage levels among 18 OECD nations, the pension wealth associated with the Social Security program finds the United States in 17th place with Social Security pensions falling 40 percent below the 18 nation OECD average.  On top of that, Social Security benefits have grown less rapidly than total earnings because of the ceiling placed on taxable earnings; the increases in earnings above the ceiling of $106,800 has risen sharply and are exempt from Social Security payroll taxes.

For balance to be achieved, a cut in benefits of approximately 15 percent for all Americans or an increase in payroll taxes of 2 percentage points or a combination of the two would result in balance between revenue and benefits on the average over the next 75 years.  Another option, raising the normal retirement age, would act as a cut in benefits.  Unfortunately, as in the case of the 1983 legislation, in actuality, the gap would still remain at about half of its projected size in year 75 because buildups of funds in the early years would only offset deficits in the later years and would not solve the problem after the 75th year.

Mr. Aaron proposes the following:

1.) Vertical Redistribution:  Since life expectancy has risen more rapidly for higher income earners and earnings inequality has increased, total benefits paid over a lifetime also increase, particularly to high income earners.  In this proposal, Mr. Aaron suggests that cutting benefits for high income earners would assist in balancing the funding gap.

2.) Variation in Benefits by Age: Benefits are currently indexed to ensure that purchasing power is constant.  Some economists recommend reductions in the indexing so that pensions would not rise as quickly as inflation.  Unfortunately, this would work against those who are extremely elderly since they would have more years of less-than-indexed pensions.  As well, these are the very people that may well have outlived their savings.

3.) Raise the Age of Initial Eligibility: This would change the Social Security balance situation very little since early savings in benefits paid are offset by later increased retirement benefits.  On the other hand, delaying retirement has other more noteworthy impacts on the economy and raising the age of initial eligibility may intensify this, particularly since the labour force participation level among older workers has increased.  This increased labour force participation increases tax revenues, boosts GDP and may result in the lowering of government spending on benefits for retirees.

4.) Raise the Wage Base: Growth in the wages of high income earners since 1983 has meant that the proportion of earnings that is subject to payroll taxes has been reduced to 84 percent, down from 92 percent in 1937.  If the wage base were raised, this would result in the immediate generation of additional revenue, particularly if benefits were not raised in conjunction with the higher wage base.

In conclusion, unless changes to the Social Security program are made soon, the problem becomes increasingly worse as the years pass meaning that swift action is imperative.  This issue will become increasingly difficult to solve as demographic changes result in fewer and fewer young Americans paying into the system that is being used by more and more baby boomers.  The author, Mr. Aaron, notes that the structural deficit inherent in the system is most easily resolved by increasing revenues rather than by decreasing benefits.  Unfortunately, raising taxes is something that is regarded as extremely unpalatable, particularly when the increased revenue will be used to fund a program shortfall that many Americans will not live to see.

Here's a quote from President Franklin Roosevelt:

“We put those payroll contributions there so as to give the contributors a legal, moral, and political right to collect their pensions and their unemployment benefits. With those taxes in there, no damn politician can ever scrap my social security program”

We shall see.