Costs for Social Security are projected to exceed the program’s income next year, which means beneficiaries may not get all that was promised to them. That’s according to a new report from the trustees of Social Security and Medicare.
The report also says Social Security funds will be tapped out by 2035. For Medicare, that year is 2026.
Although there have been warnings about the shaky future for both programs from past reports, Congress has yet to come up with any viable solutions.
“Two things have to happen: Social Security taxes have to go up or benefit levels have to go down, or some combination of the two,” said Edward Stuart, professor emeritus of economics at Northeastern Illinois University.
Michael Miller, an associate professor of economics at DePaul University, offered another solution: means-tested benefits.
“Which means if you’re a millionaire, you get less and less [benefits] as you get wealthier and wealthier, or we need to somehow have more people, and that’s a demographic change and that takes decades to change,” Miller said.
Although finding a solution – and agreeing on it – is one hurdle, Stuart said another problem is the board of trustees responsible for creating the report.
“There are supposed to be two independent trustees on [the board],” he said, adding that those two vacancies make for an “amateur report.”
“Usually, those two other people are insurance people or actuaries or public finance economists, or something like that,” he said.
The board is currently made up of Treasury Secretary Steven Mnuchin, Secretary of Labor R. Alexander Acosta, Health and Human Services Secretary Alex Azar, acting Commissioner Nancy Berryhill and Mark J. Warshawsky, deputy commissioner for Retirement and Disability Policy.
Stuart and Miller join us in discussion.