The bulk of the money paid in gets immediately paid back out to current recipients. It's a redistribution system, not a savings system. Three workers' Social Security taxes go to pay one recipient's benefits. But take demographics into account, and you'll see where the system stands to get into trouble. Baby boomers are still working now, paying into the system.
Workers now pay more than enough taxes to pay current recipients' benefits, creating a surplus.
The 76 million boomers will begin retiring in 2010, and in about 30 years, there will be almost twice as many older Americans as there are today. Congress saw this coming and in 1983 started putting money in reserve. By about 2015, however, more money will be leaving Social Security than going in, and so the reserves will begin to be used. Estimates say those reserves will be exhausted by 2037, with income paying only about 75 percent of expected payouts. Messrs. Bush and Gore have each taken one of those sides.