The projected timeline for Social Security is being extended by a year, stretching the deadline for any potential cuts to the program to the year 2035 because of a robust performance by the United States market. The projection, drawn from the Social Security Board of Trustees 2024 report, was described by Commissioner of Social Security Martin O’Malley as “good news,” but O’Malley also wants Congress to make sure the program can pay out its benefits “into the foreseeable future.”
As CBS News reports, in a press release accompanying the report, O’Malley said, “This year’s report is a measure of good news for the millions of Americans who depend on Social Security, including the roughly 50 percent of seniors for whom Social Security is the difference between poverty and living in dignity — any potential benefit reduction event has been pushed off from 2034 to 2035.
More people are contributing to Social Security thanks to strong economic policies that have yielded impressive wage growth, historic job creation, and a steady, low unemployment rate. So long as Americans across our country continue to work, Social Security can — and will — continue to pay benefits,” O’Malley said. “Congress can and should take action to extend the financial health of the Trust Fund into the foreseeable future, just as it did in the past on a bipartisan basis. Eliminating the shortfall will bring peace of mind to Social Security’s 70 million-plus beneficiaries, the 180 million workers and their families who contribute to Social Security, and the entire nation.”
The funding for Social Security has been an issue of concern stretching back to 1983, when the Reagan administration enacted a series of reforms to Social Security funding, including an increase to payroll taxes, taxation of benefits to high-income beneficiaries, and an increase of the retirement age from 65 to 67. As Brookings notes in a 2023 analysis of issues currently facing the program, the anticipation of baby boomers reaching the age of retirement was expected to increase spending on Social Security, and it has; to remedy this issue, Brookings suggests either increasing revenues or cutting benefits or a combination of both.
In a statement reacting to the report, President Joe Biden indicated that his plan has helped to extend Medicare solvency by a decade and expressed a desire to keep Republicans from cutting entitlement programs.
“As long as I am President, I will keep strengthening Social Security and Medicare and protecting them from Republicans’ attempts to cut benefits Americans have earned. Since I took office, my economic plan and strong recovery from the pandemic have helped extend Medicare solvency by a decade, with today’s report showing a full five years of additional solvency. My plan would extend Medicare solvency permanently by asking the wealthy to pay their fair share and lowering prescription drug costs.”
Biden’s Republican counterpart, Donald Trump, as Vox reports, spent much of his term in office trying to eliminate Medicare and Social Security benefits for disabled and low-income Americans. Republicans in Congress have indicated a desire to issue tax cuts, increase defense spending, and balance the federal budget, which Vox notes is impossible without cutting Social Security and Medicare spending. Eric Levitz writes, “Whatever word salads Trump serves up on cable news, one reality remains clear: A party can either oppose all tax increases or safeguard Americans’ entitlement benefits, but it cannot do both. It’s possible that a unified Republican government would resist the temptation to slash Social Security in 2025. But let a fox guard the hen house long enough, and your chickens will get eaten.”