Social Security and Medicare Are Headed for Broke, and Congress Is Doing Nothing
Congress is running out of time to shore up Social Security and Medicare.
With recent reports the programs could be out of money in a little over 10 years, one economic expert told CBN News, there just aren’t enough workers to fund the growing number of retirees.
The result: America’s trust funds are in dire straits.
“Our two biggest government programs, Social Security and Medicare the things that matter the most to our seniors, are both headed towards insolvency,” Maya MacGuineas, president of the Committee for a Responsible Federal Budget, told Fox News recently.
The government projects that retirees, including the elderly and disabled who rely on Social Security could see their payments cut by 21% by November 2035.
Medicare is expected to be insolvent by 2036.
“Every penny you and I have put in for how ever many years we’ve worked, it’s already all gone,” Dr. Jeff Haymond with Cedarville University, told CBN’s Faith Nation. “Everything we are talking about in terms of benefits for even people next month and on into the future is predicated on taxing younger workers today.”
The problem is there are just too few of those younger workers in the workforce today paying into the trust fund with their taxes to offset the growing number of aging baby boomers set to start collecting.
“One of the wonderful benefits we have is that people are living much, much longer but that good thing is complemented by the fact that we also have far fewer children and so there are fewer people coming into the program, even with immigration there is still the case where there are far fewer workers today than there were when the program was initially started,” said Haymond.
Democrats have proposed higher taxes on the wealthy to keep Social Security funded. But analysts say that’s not enough, and Republicans balk at new taxes, pushing instead to change the benefit formula and raise the retirement age for younger workers.
With the clock ticking and cuts set to take effect in nine years, both sides right now don’t seem eager to tackle the problem.
“We know the trust funds don’t have enough money to pay the benefits that have been promised and that means when they run out in less than a decade for Social Security,” MacGuineas told Fox. “If you are a newly retired in Social Security, I’m talking about when you are 70 years old, there are going to be across the board benefit cuts of above 20 percent. I mean that’s terrible.”
As Americans wait for Congress to act, analysts say it’s best to take steps to prepare for retirement by investing and saving wherever possible, so you’re less dependent on the government.
