What is the Unfunded Soc Security Liability?

The Center on Budget and Policy Priorities is a non-partisan budget watchdog group that is a great resource for information on Federal spending.

The Bush administration likes to speak of a $10 trillion dollar unfunded Social Security liability which is parroted by the media without context.

the CBPP has the context.

Would Borrowing $2 Trillion for Individual Accounts Eliminate $10 Trillion in Social Security Liabilities?

Administration officials have been downplaying the significance of the $2 trillion in transition costs required by some individual accounts plans, by comparing that cost to the unfunded liability in Social Security over an infinite time horizon, which totals more than $10 trillion. For example, White House Press Secretary Scott McClellan responded recently to a question about how the White House would pay for the $2 trillion transition cost by arguing “It’s a savings, because the cost is $10 trillion of doing nothing, and this will actually be a savings from that cost of doing nothing.”[2]

This argument is misleading. The $10 trillion number is taken out of context; it refers to the Social Security shortfall not over 75 years, but into eternity. Social Security does face a long-term deficit, but it is relatively modest as a share of the economy; in fact, it is considerably smaller than the cost of the tax cuts passed in 2001 and 2003, if those tax cuts are made permanent. More fundamentally, borrowing $2 trillion to fund individual accounts does nothing to reduce Social Security’s long-term deficit. Individual account plans that eliminate the long-term deficit in Social Security, such as the principal plan the President’s Social Security commission proposed, do so entirely by reducing future Social Security benefits, not because of borrowing.

They have more, it's very readable, and an excellent resource.