Posted on May 7, 2019
Don’t believe the right-wing spin. Social Security is in strong financial shape.
The Social Security Board of Trustees recently released its annual report to Congress. And with the report came the expected headlines predicting doom for our Social Security system.
Thankfully, these headlines couldn’t be further from the truth. Social Security is in strong financial shape. These scary headlines are the product of a decades-long, billionaire-funded campaign to undermine confidence in Social Security.
The Trustees Report shows that Social Security has an accumulated surplus of roughly $2.9 trillion. It further shows that at the end of the century, it will cost just 6.07% of GDP. That is considerably lower, as a percentage of GDP, than what is spent today by Germany, Austria, France, and most other industrialized countries on their retirement, survivors and disability programs.
Unsurprisingly, because Social Security’s income and outgo are projected out so far – three-quarters of a century – the report projects a modest shortfall. This is a much longer valuation period than private pensions use and even than most other countries use for their Social Security programs.
According to the new report, Social Security is 100% funded for the next 16 years, 93% funded for the next 25 years, 87% funded over the next 50 years and 84% funded for the next three-quarters of a century. There is no question that Congress can raise enough revenue to eliminate the projected shortfall. Indeed, we can afford to expand Social Security.
That brings us to the second misreporting we are likely to see. Along with that modest, unsurprising shortfall being the cause for breathless media reports about supposed collapse, the report will be greeted, again if past experience repeats, with lamentations from many observers that Congress has no plan to address Social Security’s projected shortfall. That is incorrect.
Democrats have specific concrete plans that they stand behind. They plan not just to ensure that all promised benefits will be paid in full and on time for the foreseeable future, but to address our nation’s retirement income crisis by increasing Social Security’s modest benefits.
It is only congressional Republicans who have no plans – at least that they are willing to publicly embrace. That is perhaps because (given that they reject requiring even the wealthiest to pay more) their preferred “solutions” involve benefit cuts, which are overwhelmingly opposed by voters across the political spectrum, including Tea Partiers and the most conservative Republicans.
Democrats are moving forward with their plans. The Social Security 2100 Act, introduced by Rep. John Larson, is one such bill. It has 203 co-sponsors in the House of Representatives – over 85% of all Democratic representatives. Rep. Larson has held several hearings on the bill and intends to bring it to the House floor this spring.
Several other bills to protect and expand Social Security benefits have been introduced in the House and Senate, and nearly every 2020 presidential candidate serving in Congress is a member of the bicameral Expand Social Security Caucus.
Again, it is Republican politicians who have no plans that they are willing to stand behind.
Not only has not a single Republican this Congress co-sponsored any of the Social Security bills introduced by Democrats nor introduced one of their own, they appear to be standing in the way. No one believes that the Senate will act once the House of Representatives passes a bill expanding Social Security and restoring it to long-range actuarial balance.
Notwithstanding that none of the bills have Republican co-sponsors, they are totally bipartisan – at least, by the measure that matters most. As divided as the American people are over many issues, we are not divided about our deep support for Social Security. Support for Social Security expansion and opposition to benefit reductions, cuts across ideological divides. An overwhelming majority of Republican voters, according to poll after poll, support Democratic proposals to expand Social Security.
This March, the Pew Research Center released a poll showing that 68% of those identified as Republican/Lean Republican believe that Congress should make no cuts to Social Security whatsoever. A year ago, in the lead-up to the 2018 midterm elections, Public Policy Polling found that 56% of those who voted for Donald Trump and 55% of those who identify as Republican would be more likely to vote for a candidate who “supported expanding and increasing Social Security.”
Furthermore, a 2014 National Academy of Social Insurance survey found that 80% of Republicans believe that Social Security is more important than ever, 72% of Republicans responded that they “don’t/didn’t mind paying Social Security taxes,” and 65% of Republicans agreed that “we should consider increasing Social Security benefits.”
And this bipartisan, consensus view of the American people is the right one. Social Security is a solution. It is a solution to our looming retirement income crisis, which threatens the retirement of so many of today’s working families. Social Security is a solution to the increasing economic squeeze on middle-class families, a squeeze that jeopardizes the economic security of all generations. And Social Security is a solution to the destabilizing and immoral income and wealth inequality, which has resulted in a handful of Americans richer than Midas, while most Americans find their economic security crumbling. In light of these challenges and Social Security’s important role in addressing them, Democratic leaders – and the American people – are asking the right question: Not how can we afford to expand Social Security, but rather, how can we afford not to expand it?
Republican politicians are standing in the way. For those for whom Social Security provides basic economic security now or promises to do so in the future – that is, virtually all of us – what we must do is clear. In 2020, we must make our voices heard. Those office seekers who support expanding Social Security and restoring it to long-range actuarial balance must be voted into office. Those who don’t should be retired. Fortunately, for them and thanks to the rest of us, they will have their Social Security to fall back on.
Nancy Altman is the president of Social Security Works and chair of the Strengthen Social Security coalition and campaign. She has a forty-year background in the areas of Social Security and private pensions. To learn more about the Social Security Works, please visit www.socialsecurityworks.org.
Social Security Works is a longtime partner of CREDO, and CREDO members have voted to donate more than $504,597 to the organization since 2013. To learn more about who we fund and how we distribute our donations, visit CREDOdonations.com.