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Wednesday, January 7, 2015

New Social Security Crisis Set for 2016

The House Republicans, in their eagerness to find a way to cut Social Security benefits, on Tuesday passed a new rule preventing the reallocation of monies between the Social Security Trust Fund and the Social Security Disability program.

No, don't let your eyes glaze over! This is a big deal. The disability portion of Social Security, with 11 million beneficiaries receiving an average $1146 a month in benefits, is expected to exhaust its separate trust fund in late 2016. When that has happened in the past, Congress has reallocated money between the two programs to keep them both solvent. Now, the new House rule prevents it from approving such a reallocation unless "it is included in a proposal that 'improves the overall financial health of the combined Social Security Trust Funds.'"

Of course, that means either raising payroll taxes or cutting benefits. Which do you think House Republicans will support?

As Joan McCarter points out, the strategy behind this is to pit retirees against the disabled. How long will it take older Republican voters to see the endgame of this strategy ("First they came for...")? With the crisis scheduled for the 2016 election season, we may soon find out.

1 comment:

  1. If they are separate trust funds, it is ridiculous to shift money between the two. If you are routinely moving money between the trust funds, then just have one trust fund.