The Time is Now for Social Security Reform

Kathryn Nix / July 02, 2010

Today, the Congressional Budget Office (CBO) released its Social Security Policy Options report, which highlights some of the proposals made by policymakers and legislators to restore the Social Security program to long-term sustainability.

Social Security, which provides living assistance to retired workers and those with disabilities, is in need of immediate reform. Social Security ran its first deficits since 1983 this year, and though economic recovery is expected to raise revenues higher than outlays once again for a few years, the program will be running permanent deficits from 2016 on. At that point, the government’s ability to pay promised benefits will depend on the Social Security Trust Fund, which will be exhausted in 2037. This, however, assumes that the funds in the trust fund are actually there—which they aren’t. Congress spent the money that was supposed to be saved and replaced it with government bonds that can be repaid only when the government collects still more taxes. (more…)