President Joe Biden and House Republicans have promised not to touch Social Security in their battle over cutting spending to address the nation’s debt ceiling crisis.
While that vow is intended to indicate support of the popular entitlement program, it could actually lead to financial disaster.
Tens of millions of senior citizens and other recipients could see their benefits slashed by at least 20% within a decade. The latest Congressional Budget Office projection found that Social Security’s retirement trust fund would be exhausted by 2032.
“There’s a sense in which doing nothing does not preserve Social Security but affects the benefits that are not able to be paid out,” CBO Director Phillip Swagel said at a Bipartisan Policy Center event last month.
Social Security has long been on shaky financial ground. As the US population ages, there are fewer workers paying into the program and supporting the ballooning number of beneficiaries, who are also living longer. In all, nearly 66 million retired workers, their dependents and survivors, disabled workers and their dependents receive monthly payments.
Forecasts on when Social Security’s retirement and disability trust funds may be depleted differ by a few years. Social Security’s trustees last year pegged the date at 2035 if Congress doesn’t act.
However, the entitlement program is also one of the third rails of American politics, so elected officials are hesitant to suggest any changes that could lead to benefit cuts.
“Pretending this isn’t a problem, that this isn’t current law, is dishonest,” said Gordon Gray, the director of fiscal policy at the right-leaning American Action Forum. “And it is a choice – a number of policymakers are making this choice. And it is a major financial risk to the retirement benefits of tens of millions of Americans.”
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