An article in Forbes last year put it succinctly: "Social security could be in worse shape than we thought." The author, Jamie Hopkins, painted an even bleaker picture than usual about the future of the program tens of millions of Americans rely on to survive after they retire.
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As it stands, the SS dollar pool is set to run out of money by 2033.
"It is not only retirees that rely upon Social Security," Hopkins wrote.
He said the Social Security Disability Insurance Trust Fund -- which provides benefits to disabled workers, their spouses, and children -- was in even worse shape than Social Security.
"Nearly 11 million people receive disability insurance from Social Security, with an average benefit of roughly $1000 per month." That fund is so depleted the Obama administration attempted to cut benefits by 20 percent, but Congress opposed the move and killed the bill.
But inaction is not a solution. As of now, the Disability Insurance Fund will run out of money in 2027 unless there is some kind of infusion of cash or reduction in benefits. What is sorely lacking is a sense of urgency.
The longer-term problem, critics charge, is that Washington DC has put the problem on hold, even as the money needed to fund the programs dwindles.
"Our seniors have worked their entire lives with the expectation that Social Security will be there to eventually assist them. It is our duty as Americans to always protect and improve the quality of life and care for our nation's seniors," Congressman Lee Zeldin said this week.
MORE TO DO
Ironically, though the system's long-term prospects for solvency seem dim, current recipients received a jolt of good news this month: an increase in monthly benefits.
"Millions of Americans who rely on Social Security can expect to receive their biggest payment increase in years this January," according to projections released by the trustees who oversee the program.
The increase is projected to be just 2.2 percent, or about $28 a month for the average recipient. Social Security recipients have gone years with tiny increases in benefits. This year they received an increase of 0.3 percent, after getting nothing last year.
That's because payouts are tied into the Cost of Living Index, which has been flat in recent years.
Zeldin acknowledged there is no single antidote to the woes of the SS system.
"There is still so much more that can be done, such as improving and modernizing the way cost of living benefits are paid out to beneficiaries, ensuring benefits change with economic changes, and encouraging more saving for retirement, to list just a few examples," he said.
In addition, citizens who live in some areas of the country find their retirement dollars don't go very far because the cost of living is so high compared to other parts of the country.
"For our seniors on Long Island, Social Security payments do not get them nearly as far, and we should reform this program so it works better for those Americans who have paid into it for their entire working lives and need it most," Zeldin said. "It is exponentially more expensive to be a homeowner in our district than other parts of our nation, and it is so important that the necessary changes are made to Social Security that properly take this into an account."
There are only two ways to make Social Security solvent in the long term: decrease payments or increase revenue. As it stands now very few senior citizens can live off of Social Security alone, so any further reductions in monthly payments could mean a death sentence.
The Social Security portion (OASDI) of payroll taxes is 6.20 percent on earnings up to the applicable taxable maximum amount, which was $118,500 in 2016. The Medicare portion (HI) is 1.45 percent more. Obviously, raising the bar and taxing individuals who make more than $118,500 annually is the easiest fix.
Many politicians acknowledge that would be an unwise move to make politically, but it did not deter Democratic presidential candidate Sen. Bernie Sanders. He is in favor of putting Social Security on a more solid financial footing by raising the cap on earnings that are taxed.
"By lifting this cap so that everyone who makes over $250,000 a year pays the same percentage of their income into Social Security as the middle class and working families, [we] would not only extend the solvency of Social Security for the next 50 years, but also bring in enough revenue to expand benefits by an average of $65 a month; increase cost-of-living adjustments, and lift more seniors out of poverty by increasing the minimum benefits paid to low-income seniors," Sanders said.
"It's the biggest hit on the people that couldn't take it," said Dean Baker, an economist with the Liberal-leaning Center for Economic and Policy Research. Baker proposes raising the cap to around $190,000, reflecting the growing wealth at the top of the income scale. Raise it higher than that, he said, and wealthy earners will just start finding ways to dodge it.
"There are many proposals in the House relating to Social Security. Obviously, the best solution includes growing the economy to broaden the base of workers paying into the trust fund," Zeldin said. Other proposals have included increasing the cap on contributions, raising the eligibility age, and personalized accounts.
Zeldin said the benefits for current retirees and those close to retirements should be "fully protected."