The Future of the Social Security ProgramJul 14th, 2010 | By Sharon Shaw Elrod MSW EdD | Category: Social Security & Medicare
Ongoing questions about the Social Security program are being addressed in a bi-partisan fiscal commission President Obama appointed; the group is addressing the federal budget deficit and a big part of that involves what to do with Social Security.
Some in our country believe Social Security needs to be strengthened. It was created by FDR back in the 30s and helped get the country moving again after a devastating depression. A recent AARP Bulletin survey revealed more people over 50 are depending more on Social Security than they thought they would as younger citizens. The program made a huge impact on poverty among senior citizens.
Others believe Social Security needs to be reduced, almost solely for the purpose of controlling the federal deficit, which has increased into the trillions of dollars in the past 10 years. (The deficit was non-existent at the end of President Clinton’s term of office.) In articles perused on the Internet, one cannot find any other reasons offered for shrinking the Social Security Program.
Another recent survey conducted by AARP Bulletin indicated 81% of those responding do not want Congress to cut Social Security to help reduce the federal deficit. So why is reducing Social Security even on the table?
Let’s look at some facts:
- Employer and Employees pay a 12/4% payroll tax to finance Social Security;
- Monthly benefits are paid to 53 million senior citizens in 2010;
- For the past 25 years, Social Security contributions have exceeded distributions, creating a $2.5 trillion reserve fund;
- In 2010, the system is drawing on the reserve fund because of the recession and high unemployment (less is coming in in contributions);
- Congressional Budget Office estimates say payroll taxes and the reserve fund will pay Social Security benefits in full for the next 33 years.
Senator Herb Kohl, D-WI, chairs the Special Committee on Aging; he said recently, “Contrary to popular belief, the sky is absolutely not falling for Social Security. With modest tweaks, we can ensure solvency and even strengthen benefits for those who count on their monthly check the most.”
Next week, SCJ will look at a recent report by the United States Senate Special Committee on Aging and its recommendations for strengthening Social Security without cutting benefits.