The New York Times recently published an article highlighting six “myths” about Social Security, but unfortunately, it did more to perpetuate misconceptions than dispel them. As Social Security’s 90th birthday approaches, it’s essential to get the facts straight.
Social Security’s trust fund is indeed running out of money, and by 2032, its reserves will be depleted. This means that policymakers must take affirmative action to avoid a massive benefit cut, equivalent to $18,000 for a dual-earner couple, in just seven years.
Another common myth is that aging baby boomers are the primary driver of Social Security costs. While this may seem true, the truth is that an aging population, including retirees and those close to retirement, accounts for a significant portion of the program’s expenses. The Times itself acknowledges that population aging has accelerated the drawdown of the trust fund.
Social Security does contribute to the deficit, but not in the way often claimed. Unlike on-budget deficits, Social Security’s contribution is part of the unified budget deficit. While it has reduced the overall deficit in the past, its current cash imbalance adds $250 billion to this year’s deficit.
The trust fund represents a real obligation, backed by an I.O.U. promise from the government. This is not like corporate bonds or stocks but rather a mechanism to ensure future benefit payments are made based on payroll tax collection. The Times’ suggestion to “inject general revenue” into Social Security benefits would actually mean doing what’s already allowed under current law.
Contrary to popular opinion, cutting benefits now is not necessary. A bipartisan fix that combines benefit and revenue changes can restore solvency without drastic cuts. In fact, policymakers could implement reforms today to avoid a 24% benefit cut in seven years, allowing for more targeted and gradual adjustments.
Finally, the myth that Social Security is plagued by waste, fraud, and abuse has been debunked. The program’s overpayment rate is less than 1%, among the lowest in federal government agencies.
Social Security is indeed facing an insolvency deadline, and it desperately needs a rescue plan. By setting the record straight on facts rather than perpetuating myths, we can work towards finding solutions that benefit current and future beneficiaries alike.
Source: https://www.crfb.org/blogs/new-york-times-article-does-more-perpetuate-myths-dispel-them