One of my main focuses in Congress is protecting, preserving, and reforming Social Security. Social Security provides benefits to approximately 55 million people. It is a critical foundation of income for retired and disabled workers – nearly two-thirds of the elderly get at least half of their income from Social Security. One in five elderly Americans has no income other than Social Security.
Though long foreseen, a “perfect storm” has emerged over the years that threatens the solvency of not only the Social Security system, but the federal government in general. According to the Government Accountability Office (GAO), about 47 cents of every federal dollar spent went to Social Security, Medicare, Medicaid and interest on the federal debt. Absent action, Social Security – along with these other programs – will soon grow to consume every dollar of revenue that the government raises in taxes. At that point, we will be left with no good options.
The retiring of the “Baby Boomer” generation as well as other changes in America’s demographics such as decreasing mortality rates and longer life spans due to medical innovation and lower birth rates (relative to the “Baby Boomer” generation) are leading to a larger senior population that will be retired longer. In 1945, there were approximately 42 workers paying into the system for every one retiree receiving benefits. Currently, there are only about three workers for every one retiree – and soon there will be only two workers for every beneficiary. The result: a significantly larger share of the population will soon be drawing Social Security benefits for a longer period of time with a smaller share of the working population paying into the system to fund the promised benefits.
As a result of these demographic issues as well as our still-struggling economy, in 2010, for the first time since 1983, Social Security expenditures exceeded its non-interest receipts (and again in 2011) – meaning, it paid more in benefits than it received in payments. Social Security has fallen into permanent deficit, meaning it will continue to take in less than it will pay in benefits each year going forward. According to the 2012 Social Security Trustees’ report, the Social Security Trust Funds will be exhausted in 2033, and will unable to pay full benefits from its revenues. This is especially concerning since this deficit is not only detrimental to current and future Social Security beneficiaries, but also could have considerable implications for the federal budget’s already grim financial situation since the federal government has borrowed significantly from Social Security to finance other government operations and programs not related to Social Security.
All of these issues surrounding Social Security demonstrate the urgent and growing problems with its solvency. In order to preserve the program, we must enact responsible reforms now. I believe it is crucial for Congress to examine ways to provide a long-term solution for the problems that currently plague the system. Social Security needs to be reformed to address its deficits. I believe that seniors must receive the benefits they have been promised and have planned for during their working years. Congress should work to preserve the benefits that those at or near retirement have planned their lives around, while also guaranteeing that future generations have the ability to plan for their eventual retirements.
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