Every year, the Social Security Board of Trustees releases an annual report to Congress, assessing the health of the Social Security trust fund. In spite of what is often repeated by the media, every year the Trustees Report shows the Social Security trust fund growing—and this year’s report was no exception.
Social Security is projected to run a surplus again this year. And next year. And the year after that. And the year after that. Once again, it’s clear that there is no crisis in Social Security’s financing.
The fact is that, as the richest nation in the world at the richest point in our history, not only can we afford the current levels of Social Security protections, we can afford to greatly expand Social Security. Social Security’s benefits are modest and don’t cover a number of eventualities, such as parental leave and sick days, which the Social Security programs of other developed countries cover.
Social Security is a solution to the looming retirement income crisis where most workers will be unable to retire without a drastic reduction in their standards of living. Social Security is the most universal, secure, and efficient source of retirement income that we have, providing a guaranteed, inflation-protected source of income that one will never outlive. And expanding Social Security is completely affordable. Millionaires and billionaires should pay the same rate as everyone else on all of their income. The trust fund will remain strong, even with expanded benefits.
Social Security helps more than retirees—people with disabilities also receive benefits, as do dependent children who have lost parents. Even though all of the benefits under Social Security are interrelated, there is, for historical reasons, two separate funds, one covering Old Age and Survivor’s benefits, one covering Disability. Not surprisingly, from time to time, the two funds have to be balanced. Eleven times in Social Security’s history, Congress has authorized transfers between the Old Age and Disability funds to rebalance them. This has always been uncontroversial—until now. Just like they did with the debt ceiling, some members of Congress have made clear that they will use any means necessary to endanger our earned benefits.
The Trustees Report once again projects that Congress must act before the end of 2016 to rebalance Social Security’s trust funds. If that is not done, Social Security’s disability benefits will be cut by around 20 percent.
Of course, expanding Social Security and making everyone pay the same rate on all of their income would solve this problem—there would be more than enough money flowing into the system to cover all costs. But today’s Republican leaders have already made clear, through a rule adopted on the very first day of the new Congress, that they plan to hold rebalancing hostage this time around. Presumably, they are seeking a bipartisan deal, worked out behind closed doors, that cuts Social Security and enacts other unpopular changes.
Expansion is excellent policy. It is extremely popular. It solves many challenges – including the upcoming, manufactured crisis occasioned by the simple need to rebalance. If Democrats are smart, they will make this an issue in 2016 and smoke out their Republican opponents. Since the Trustees Report tells us that Social Security legislation must pass before 2016, the choice between cuts and expansion must be extremely clear.
Social Security is the solution to our looming retirement income crisis, the increasing economic squeeze on middle class families, and the perilous and growing income and wealth inequality. In light of these challenges and Social Security’s important role in addressing them, the right question is not how can we afford to expand Social Security, but, rather, how can we afford not to expand it.
Add your voice: Tell Congress that you support our united Social Security system, and won’t be swayed by cynical attempts to scaremonger the American people into accepting cuts to earned benefits.