Let's get real about Social Security Retirement Funding
Posted Apr 24 2012 7:31pm
The trustees who oversee Social Security's two trust funds—one for disability benefits, the other for retirees—said reserves for the fund that pays disability benefits would be exhausted by 2016, two years earlier than projected last year.
The Social Security trust-fund balances are essentially the difference between the taxes that have been paid into the programs and the total number of benefits that have been paid out over the years.
However, the Social Security disability program and the Medicare program, that covers hospital care, are already paying more in benefits than they collect through tax revenue.
In recent years, the Social Security disability rolls have soared, as many Americans with mental and physical health problems sought to enter the program and others with less severe issues applied because of a scarcity of work. In 2011, Social Security paid $596.2 billion in retirement benefits to 44.8 million Americans and $128.9 billion in disability benefits to 10.6 million recipients. By law, benefits are paid in full as long as the fund balances represent a surplus.
The government (read: your representatives in Congress) has borrowed from the Social Security trust fund to pay for other operations and now just pays interest to the program and may try to steal Social Security retirement funds once again. For example, lawmakers could consider redirecting money meant for the retiree program to the disability fund.