Categorized | Features, Pushback

‘The Financial Health of Social Security Is Strong’

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Are you scared about the future of Social Security and Medicare?

By Al Norman

Are you scared about the future of Social Security and Medicare? Here’s the first sentence from a recent story in the New York Times:

“The financial outlook for Medicare and Social Security, two of the nation’s most important social safety net programs, remains precarious, threatening to diminish retirement payments and increase health care costs for Americans in old age, the Trump administration said on Monday.”

On April 2, the 2019 Annual Report of the Social Security/Medicare Board of Trustees was sent to Congress. The headline in The Times warned that “Social Security and Medicare Face Insolvency,” and added: “the cost of Social Security…will exceed its income in 2020 for the first time since 1982,” and Medicare “is expected to be depleted in 2026.”

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But Nancy Altman, the head of the advocacy group Social Security Works, refutes the widespread media “misreporting” of the program’s demise. “Thanks to decades of a billionaire-funded campaign to undermine confidence in Social Security,” Altman says, “the Trustees Report will likely be greeted with cries that Social Security is going broke. The truth is that Social Security is in strong financial shape.”

The program  today rests on a surplus of almost $3 trillion. By 2100, it will cost just 6 percent of our Gross Domestic Product — less than what most industrialized nations spend on their retirement programs. Based on the Trustees’ 75-year projections, Social Security will be 100 percent funded for the next 16 years, 93 percent funded for the next 25 years, 87 percent funded over the next 50 years and 84 percent funded for the next three-quarters of a century. Altman concludes: “There is no question that Congress can raise enough revenue to eliminate the projected shortfall. Indeed, we can afford to expand Social Security.”

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The response to the Trustees’ report diverged along political lines. “Medicare is going broke,” declared Republican Congressman Kevin Brady of  Texas. “and Social Security is not solvent.” The White House budget plan released in mid-April proposed a cut of $26 billion from Social Security Disability Insurance, and $818 billion from Medicare over 10 years.

The response to the Trustees’ report diverged along political lines.

But Democratic Congressman Earl Pomeroy of North Dakota, who chairs the Social Security Subcommittee of the House Ways and Means Committee said: “The Trustees of Social Security lifted up the hood and checked out Social Security’s workings and reported that at 75 years it was still going strong and would be fine for decades to come.” Pomeroy said the nation’s retirees “can rest assured that the financial health of Social Security is strong despite long-term challenges. Despite the ongoing effects of the recession, Social Security’s long-term financing continues to be stable.”

The Social Security 2100 Act, introduced by Democratic Congressman John Larson of Connecticut has 203 cosponsors in the House of Representatives — 85 percent of all Democratic representatives. When Rep. Larson first introduced this bill five years ago, he said: “By taking common-sense, gradual steps, we can ensure that Social Security benefits keep up with the needs of current and future generations.” Larson’s bill provides a modest benefit increase for current and new Social Security beneficiaries, adopts a higher Cost of Living Adjustment formula, gives a tax break by raisingthe threshold for taxation on SS benefits, and protects low income workers by creating a new minimum benefit that will be 25 percent above the poverty line.

Some members of Congress may not be prepared to protect the program, but the American people know better. A recent poll by the Pew Research Center showed that 68 percent of Republicans want Congress to make no cuts to the entitlement. In 2018, Public Policy Polling found that 56 percent of those who voted for Donald Trump and 55 percent of those who identify as Republican would be more likely to vote for a candidate who supported expanding and increasing the program. A 2014 National Academy of Social Insurance survey reported that 65 percent of Republicans agreed that “we should consider increasing Social Security benefits.”

So you have a choice: Be scared, or email this article to your U.S. Congressman and Senator, urging them to “improve Social Security and Medicare, because the wealthy can take care of themselves.”

Al Norman worked as an elder advocate in Massachusetts for 38 years. He can be reached at alnormaneldercare@gmail.com.

 

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