COVID recession pushed Social Security insolvency up a year

[George II]

Source: Associated Press

WASHINGTON (AP) — The sharp shock of the coronavirus recession pushed Social Security a year closer to insolvency but left Medicare’s exhaustion date unchanged, the government reported Tuesday in a counterintuitive assessment that deepens the uncertainty around the nation’s bedrock retirement programs.

The new projections in the annual Social Security and Medicare trustees reports indicate that Social Security’s massive trust fund will be unable to pay full benefits in 2034 instead of last year’s estimated exhaustion date of 2035. For the first time in 39 years the cost of delivering benefits will exceed the program’s total income from payroll tax collections and interest during this year. From here on, Social Security will be tapping its savings to pay full benefits.

The depletion date for Medicare’s trust fund for inpatient care remained unchanged from last year, estimated in 2026.

In the 1980s, financial warnings about Social Security prompted then-President Ronald Reagan and lawmakers of both parties in Congress to collaborate on a long-term solvency plan, but such action is unlikely in today’s bitter political climate. Democrats who control the White House and Congress offered assurances they would protect both programs.

Read more: https://apnews.com/article/business-medicare-6d527d62acb9a6ee09361d81ccacd36f

[BlueIdaho]

1. Raise the income cap for collecting SSA assessments.

Problem solved.

[TimeToGo]

3. Exactly

At the very least, to the level of Congressional salary.

[SheltieLover]

4. Remove it altogether!

Wait until all the anti vax long haulers are added to SSDI!

[BlueIdaho]

11. Even better!

There is no logical reason to cap SSA payments except for the clout of the 1%.

[SheltieLover]

12. Yup!

[area51]

30. +1 n/t

[deizo]

9. yes exactly!

I think once the economy picks up we will get that year back!

[SheltieLover]

13. I hope you are correct!

[Rebl2]

10. This has been

talked about for many years and Congress does nothing and don’t expect them to now.

[Dan]

23. Just remove the cap!

[Elessar Zappa]

2. We must address social security

as soon as possible. Benefits shouldn’t go down, in fact they should be increased. There must be a solution.

[SheltieLover]

6. Remove income cap.

When anti vacx long haulers are added to SSDI, they will break the system.

[Elessar Zappa]

8. Good point about the long haulers.

And everyone on SSDI goes on Medicare so it’ll be stressed too.

[roamer65]

16. +1000

[twodogsbarking]

5. At three hundred million dollars a day how many

Afghan days would it take to make SS healthy?

[Captain Zero]

29. When a parent dies from covid, minors get Social Security Survivors Benefits.

That will be putting a strain on the system too.
Ask Paul Ryan about those benefits, it's how he went to college.

[bucolic_frolic]

7. COLA's provide the largest dollar amount increases to those who need it least

Maybe consider an age and income cap for COLA's. SS was enacted to provide necessities for working class old age retirees. We have deviated far from that initial intent.

[Traildogbob]

18. Yes

The average $13 dollars a month COLA has given us the last many years has got me living way too extravagant. Stuffing my bank account. But insurance premiums, Health, auto, Property, medicine, copays, basic food, has absolutely held steady for decades. Damn old people, hurry and die from Covid, for the economy. Be a patriot.

[twodogsbarking]

20. I worked and paid in for more than fifty years.

Have you?

[bucolic_frolic]

24. But it isn't a private investment program with guaranteed returns. It is a social program

in the very sense of a Commonwealth to support the society, rich and poor, old or disabled, disadvantaged or destitute. All from relatively modest but steady contributions.

And the tone of your question is offensive to me.

[twodogsbarking]

26. My intent was not to offend.

[AllaN01Bear]

14. remove the tax for ss benis . make the rich pay their fair share.

[roamer65]

15. Just wait till all these unvaccinated long haul covidiots start filing for SSDI.

I think we should exclude them from drawing it.

[PSPS]

17. "Insolvency" is an inaccurate and a purposefully inflammatory GOP term to encourage its dismantling

"Insolvency" is an inaccurate and a purposefully inflammatory GOP term to encourage its dismantling

[yaesu]

19. which is bs, all they need to do is make the uber rich pay into social security

as its stands now the maximum amount of income subject to the Social Security tax is $142,800. this must be raised much, much higher.

[twodogsbarking]

21. No it shouldn't. Raise taxes.

[aggiesal]

22. Social Security will never be insolvent ...

AP should correct it's title.

It's the Social Security Trust fund this decreasing just as it was designed to do.
Once the SSTF is emptied, then it's back to the normal SS paid in, SS paid out.

The trust fund was created back in the 80's because the baby-boomers were about
to retire so those of us starting our careers in the 80's & 90's paid double the amounts
to create the trust fund.

But I do agree that SS needs to be modified to have the wealthy pay a larger share
than they currently are. The amounts paid out could increase by double and cover
yearly cost of living increases.

[Deminpenn]

25. Once again, there is no "trust fund"

Soc Security is a pay-as-you-go system where the soc security taxes paid by current workers are used to pay benefits to current eligible beneficiaries.

If there is more money coming in than is being paid out, by law, that money must be invested in US Treasury bonds.

Currently there is more coming in than is going out, but at some point that might change. If/when that happens, the Treasury bonds will be redeemed until there are no more left to cash. At that time whatever the difference is between income and outgo will have to come from the general federal budget.

Further, soc security benefits are capped at something like 2700/mo. They are also means-tested and can be subject to federal income tax.

[Farmer-Rick]

28. Yeah, I understand what you are saying

But in the public mind there is a fund where all our doubled (by Greenspan and Raygun) payments have been stored. Yeah, not really but it's easier to understand that way.

The "Trust Fund" is supposed to be depleted. That was the plan.

[Farmer-Rick]

27. Medicare will always be in trouble as long as our

Healthcare system is such a mess. Medicare will be in trouble until we stop making our health a profit center. Someone has to pay for the excessive profits of insurance and medical corporations.

For social security, I doubt that all the Covid-19 deaths were calculated accurately. And as we learned in1918, even after the pandemic is over, life expectancy drops for those who caught it and survived.

The true death count from Covid-19 won't come out for years. That will leave extra funds for social security.