Social Security will no longer be able to pay full benefits in 2033, a year earlier than previously expected, according to a new report.
The updated projections, in the annual trustee report, mean that without action to stabilize the Old-Age and Survivors Insurance Trust Fund, Social Security would have enough money to pay about 77% of the total scheduled benefits.
A separate report for Medicare shows that its Hospital Insurance Trust Fund can continue paying full benefits through 2031, three years longer than previously expected. The fund would then have enough money to pay about 89% of expected benefits.
Maya MacGuineas, president of the nonpartisan, nonprofit Committee for a Responsible Federal Budget, sharply criticized lawmakers in a written statement following the reports’ release, saying “many in Washington would rather weaponize these programs than save them.”
“Anyone who pledges not to touch Social Security is endorsing a 20 percent across-the-board cut in benefits,” MacGuineas said. “Refusal to fix Medicare means supporting major disruptions in health services.”
Centers for Medicare and Medicaid Services Administrator Chiquita Brooks-LaSure said in a written statement accompanying the report that the Biden administration looks “forward to working with Congress to strengthen this vital program serving over 65 million Americans.”
Kilolo Kijakazi, Social Security acting commissioner, said the “Trustees continue to recommend that Congress address the projected trust fund shortfalls in a timely fashion to phase in necessary changes gradually.”
“Social Security will continue to play a critical role in the lives of 67 million beneficiaries and 180 million workers and their families during 2023,” Kijakazi added. “With informed discussion, creative thinking, and timely legislative action, Social Security can continue to protect future generations.”
The report’s release comes amid a tense back-and-forth between U.S. House Speaker Kevin McCarthy and President Joe Biden over the federal budget deficit and the $31 trillion national debt.
Biden has repeatedly called on Congress to raise the nation’s borrowing limit, known as the debt ceiling, without strings attached.
McCarthy and many House Republicans have said cuts to future spending must go along with legislation to raise the debt limit, though they’ve mostly ruled out raising additional revenue through taxes.
McCarthy has pledged not to cut Social Security or Medicare. House Republicans, however, have not yet released their budget resolution for the upcoming fiscal year.
The tax and spending blueprint would detail how the party wants the federal government to approach fiscal policy during the next decade, including on entitlement programs.
The Biden administration has repeatedly called on House Republicans to release the document so the two can begin negotiations over future revenue and spending. House Republicans have given no timeline for releasing the budget.
If negotiators can’t broker a bipartisan debt limit deal before the summer deadline, and the nation begins its first ever debt default, Social Security and Medicare benefits would likely be delayed. The extent of those delays is unknown.
The Indiana Capital Chronicle is an independent, not-for-profit news organization that covers state government, policy and elections.