Social Security on Life Support? - The Hill
As most who even only occasionally follow what’s happening in Washington, D.C. already know, the nation’s most important senior benefit program, Social Security, is headed for severe financial difficulties unless Congress acts soon. It’s not like it is a new circumstance either – Congress has known for decades that Social Security would run out of reserved funding in the mid-2030s, at which point benefits will need to be cut by as much as one fourth. Not a pretty outlook, for sure.
What is the problem? To somewhat oversimplify, beneficiaries are living much longer now, while declining birthrates mean fewer than needed workers are contributing to the program to fund expenses. That has actually been going on since 2010, but the reserves held in Social Security’s Trust Fund have been used since to pay full benefits to all. However, according to Social Security’s Trustees (as well as the Congressional Budget Office), those reserves will be gone in 2033, which will mean an across-the-board 23% reduction in everyone’s Social Security benefit. And that would not be a pretty picture, considering that a majority of seniors rely on Social Security as a “major” source of retirement income.
Though Congress has been kicking the Social Security reform can down the road for decades, it is now time for them to put party politics aside and do what’s right for the country, as this article by Mark Duggan appearing at The Hill explains. Mr. Duggan defines the current problem and gives us some history about past reform to resolve similar circumstances, and then tantalizes us with a promise of a potential solution he will shortly be proposing. We’re looking forward to hearing his suggestions. Click here to read Mr. Duggan’s article in The Hill.
As an example of the leading thoughts on reforming Social Security, the Association of Mature American Citizens (AMAC, Inc.) believes Social Security must be preserved and modernized. This can be achieved without tax increases by slight modifications to cost of living adjustments and payments to high income beneficiaries plus gradually increasing the full (but not early) retirement age. AMAC Action, AMAC’s advocacy arm, supports an increase in the threshold where benefits are taxed and then indexing for inflation, and calls for eliminating the reduction in people’s benefits for those choosing to work before full retirement age. AMAC is resolute in its mission that Social Security be preserved for current and successive generations and has gotten the attention of lawmakers in D.C., meeting with many congressional offices and staff over the past decade.