As usual, reports of Social Security's imminent demise are exaggerated

It's an annual ritual: The Social Security trustees release a report detailing the status of Social Security and Medicare, and Republicans, Third Way Democrats, and members of the punditry that have been conditioned to believe them howl that the programs are dying and must be cut to be saved. Case in point, this AP report: "Medicare, Social Security face shaky fiscal futures." In it, Arkansas Rep. Steve Womack, the senior Republican on the House Budget Committee, warns that the programs are increasing the deficit, and "We cannot afford to ignore this reality any longer."

Except that that's not really what the trustees' report said, and, as usual, the Los Angeles Times’ Michael Hiltzik is here to set the record straight. In fact, he argues, the report says Social Security has gotten healthier. He points out that the report gives Social Security the same number of years of being able to pay out full benefits under the status quo—16 years. Last year, it said the program's reserves would be exhausted in 2034, and this year it says it will be 2035. More importantly, though, Hiltzik notes that the "cost of making Social Security perfectly solvent has come down." In 2018, the trustees estimated that it would take a payroll tax hike of nearly 2.8 percent (bringing it to a shared 15.18 percent between employers and employees), and this year they've revised it down to 2.7 percentage points, to a combined payroll tax of 15.1 percent. The current rate is 12.4 percent.

The trustees also say that the program remained in the black last year, despite their warning then that the program would be paying out more than it brought in. They projected a shortfall of more than $1 billion, but that didn't happen, and in fact the program was in the black by more than $3 billion and can run without drawing down reserves until 2020. Hiltzik points out that "Social Security's fiscal condition is dynamic. It’s dependent on a host of interrelated economic and demographic factors, many of which are fundamentally unpredictable even a few years into the future, much less 16 years." One of the reasons for the financial situation of Social Security is a continued downward trend, since 2014, in the number of disability enrollments; and "the disability insurance trust fund's exhaustion date has been moved to 2052 from 2032."

Botton line for the present? "This year's trustees report shows that, contrary to conservative propaganda, Social Security is not 'going bankrupt' or 'in peril,'" Max Richtman, head of the National Committee to Preserve Social Security and Medicare, said Monday. However, that doesn't mean Social Security can't be put on a completely secure footing and cease to be such a political football. There are plenty of ways to do so—including implementing comprehensive immigration reform that brings millions of new workers into the system, or lifting the payroll tax cap on the wealthy.

Fixing the country's most successful and popular program is perfectly doable, and should be one of the first priorities of a new Democratic administration and Congress. Which we need to make sure we have in 2020. Having these programs to kick around has become a cottage industry for the deficit peacocks. It's time to end that.

from Daily Kos http://bit.ly/2GLKjsN