Last week's annual Social Security report still projects that the retirement trust fund will be depleted in 2033.
Across the board benefit cuts of approximately 23% will be required unless action is taken.
"That leaves us hurtling toward the aforementioned 23% benefit cuts in just eight years—
an outcome that is both unacceptable and entirely avoidable."
"There are just two ways to avoid that:
1. When the solvency cliff is reached, Congress can inject general revenue into Social Security on an emergency basis to maintain benefits. Social Security would be partially financed through debt for the first time.
2. We elect a Congress and president willing to push through a strong, progressive solution that does include tax increases."
"And both of those things could occur - probably in that order.
First a crisis, then a progressive solution that gets the program back on track."
https://retirementrevised.substack.com/p/this-is-not-the-moment-for-social
Comments
First, keep in mind that there is no dedicated/separate fund for Social Security.
FICAs go into the general Treasury account, and there is a system to track these Treasury IOUs - the so-called SSA trust fund.
So, that IOU will be exhausted by 2033. The benefit cliff is because that 23% or so of the SSA benefit from Treasury IOUs will disappear.
People are expecting or hoping that a last minute solution to this SSA crisis.
But what if the Treasury is simply ordered to keep paying temporarily or permanently what it had been paying? Stranger things have happened.