If you listen solely to the mainstream media, you might be misled into believing the yearly Social Security Trustees Report is delivering good news. Liberal outlets like the New York Times gleefully declared that a “robust labor market stabilized Social Security and Medicare funds,” while CBS News blithely reported that “the federal retirement program said Monday it may not need to cut benefits until 2035, one year later than previously forecast, owing to stronger U.S. economic performance.”
“On the projected depletion date, 83% of benefits will be payable if Congress does not act sooner to prevent that shortfall,” CNBC chimed in, celebrating a “slightly improved outlook” attributed to a so-called “strong economy.”
Here’s the uncomfortable truth these media gatekeepers gloss over: this narrative is patently false.
Despite their sugar-coated portrayals, the federal retirement segment of Social Security is still on course to go bankrupt by 2033. At that juncture, Social Security will be capable of disbursing only 79% of its scheduled benefits, effectively creating a 21% across-the-board benefit cut—a scenario fiscal conservatives have been warning about for years.
However, the media, in cahoots with President Joe Biden’s administration, have set their sights on pillaging the Disability Insurance (DI) Trust Fund to prop up the faltering retirement program for an additional two years—a move that is blatantly illegal.
Despite being branded the Old-Age and Survivors Insurance (OASI) program, Social Security’s so-called “retirement fund” isn’t an insurance program at all. It’s a wealth transfer scheme that’s highly regressive. While the poverty rate among retirees hovers around 10%, and in some studies as low as 7%, the nation’s overall poverty rate stands at about 12%. The unsustainable spending habits of the baby boomer generation, along with their shrinking family sizes, have decimated the worker-to-beneficiary ratio from four in 1965 to just 2.7 in 2024.
Since 2021, Social Security has been paying out more than it collects in payroll taxes, creating an incontrovertible fiscal drain that the trustees admit will persist indefinitely.
Already, OASI essentially robs from the relatively poor to sustain the affluent. Now, to delay its inevitable bankruptcy, the trustees want to siphon funds from the DI Trust Fund, which aids the truly destitute and disabled, to continue lining the pockets of the richest generation in modern history.
Unlike OASI, the DI Trust Fund is genuinely an insurance program, designed to spread the risk of severe, incapacitating disabilities as defined by federal law. Furthermore, it is a progressive system: it ensures that payroll taxes get redistributed to those who are in more dire straits. A 2012 report by the Social Security Administration revealed that while 7% of retirees live in poverty, nearly 25% of disabled workers do.
Per federal law, the DI Trust Fund is entirely separate from the Ponzi scheme that is the retirement program. Unlike the OASI Trust Fund, the DI Trust Fund maintains a trajectory of solvency and promises to remain financially sound throughout this century. For the 9 million disabled Americans and their families who rely on it, the solvency of the DI Trust Fund is indeed a success story.
Yet, it is precisely because the DI Trust Fund is well-managed and sustainable that Biden’s politically appointed trustees want to raid it. Keeping the OASI operational for another two years would mean plundering funds from a program that is otherwise a model of fiscal responsibility.
The trustees’ report quietly mentions on Page 26: “Social Security’s combined trust funds are projected to cover full payment of scheduled benefits on a timely basis until the trust fund reserves become depleted in 2035.” This claim hinges on the presumption that laws will be changed to allow the transfer of funds between OASI and DI as needed.
Though raising the retirement age won’t completely salvage Social Security, it’s worth noting that American life expectancy has increased by 23% since the retirement age was first set. Meanwhile, Biden aims to dismantle a rare fiscally prudent initiative like the DI Trust Fund to extend the boomers’ entitlement by a mere two years, highlighting a glaring disparity in priorities.
