2021 Expected to Bring Proof that the Solvency Problem is Real

“Beginning in 2021, Social Security is expected to expend more money than it collects.” This chilling sentence offered by The Motley Fool editorial folks in a post on foxbusiness.com (click here to read it) won’t be news to those who have been tracking the development of the program’s long-term financing picture, and certainly not to those who’ve taken a look at the annual reports produced by the Social Security Board of Trustees. In effect, the situation forecasted to develop next year has been expected for some time, and is simply a situation in which the demographics are catching up with the program.

There are a number of related reasons why the net cash outflow is finally here, chief among them the dwindling number of workers supporting today’s–and tomorrow’s–beneficiaries and the extended life expectancies of those beneficiaries. And while 2021 may bring a wake-up call to some quarters, many have been watching this problem develop for a number of years. It’s been nearly 40 years since the Social Security has been in a situation this dire, and history can recount the historic actions taken then by the Reagan administration to achieve a bipartisan revamping of the program to restore solvency.

The Association of Mature American Citizens (AMAC) is one of the organizations active in calling for attention to Social Security’s problems. AMAC’s firm position is that Social Security must be preserved and modernized, and believes this can be achieved by making modest changes in cost of living adjustments and the retirement age, with no additional taxes on workers.  AMAC advocates for a bipartisan compromise, and has developed its “Social Security Guarantee,” a legislative framework that takes selected portions of bills introduced by the late Rep. Johnson (R-TX) and current Rep. Larson (D-CT) and merges them with AMAC’s own well researched ideas.  One component is Social Security PLUS, a new, voluntary plan that would allow all earners to have more income available at retirement.  This component is intended to appeal especially to younger workers.  AMAC is resolute in its mission that Social Security be preserved and modernized and has gotten the attention of lawmakers in DC, meeting with a great many congressional offices and their staffs over the past several years.  Read AMAC’s plan here.


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