During the midterms and more recently during his State of the Union address, President Biden accused Republicans of wanting to cut Social Security. It’s not true. Nobody is talking about taking away the Social Security that people have earned. 

Biden understands why Social Security is called the third rail of American politics. Anyone who touches it gets electrocuted, as an aide to then-House Speaker Tip O’Neil once remarked. Politicians even mention it at their own risk, even if the program is fundamentally flawed and has needed reform for over 30 years.

Social Security is unsustainable. According to the Social Security Board of Trustees, the trust fund will be insolvent by 2035. More recently, The Congressional Budget Office (CBO) estimated the Social Security Administration (SSA) will be insolvent by 2032, one year sooner than the CBO’s prior forecast in December 2022.

Biden can bark all he wants, but the demographics and mathematics say that every year Congress waits, it gets closer to imploding. 

In 1935 when FDR signed Social Security into law, the average life expectancy in the U.S. was 61 years. The first beneficiaries could draw on the fund five years later, in 1940, when they turned 65.

It’s brilliant: a mandatory “retirement plan” where the government collects money from workers and their employers for their entire working lives. Then when a worker is 65, they can collect Social Security. If the worker only lives until 61, sorry, they lose. There’s no inheritance for the family. They don’t even get a consolation prize – no set of steak knives.

Today, the average life expectancy is 78. Just this weekend, I saw this article in the Boston Globe Magazine: When it comes to aging, 90-plus or even 100 might not be “extreme” anymore

When Social Security began, the average person didn’t live long enough to collect. People live well past 65 now and collect Social Security for many years.

That’s the demographics.

There’s also the arithmetic.

In 1940 there were 159 workers for every beneficiary.

  • 1950: 16.5 workers per beneficiary
  • 1960: 5.1 workers per beneficiary
  • 1970: 3.7 workers per beneficiary
  • 1980: 3.2 workers per beneficiary
  • 1990: 3.4 workers per beneficiary
  • 2000: 3.4 workers per beneficiary
  • 2010: 2.9 workers per beneficiary

Today there are 2.8 workers per beneficiary – heading for 2.5.

With Baby Boomers retiring, the math doesn’t work anymore.

Only the government can have current workers pay for today’s retirees. If a publicly traded U.S. company funded its retirement program this way, it would be called a pyramid or Ponzi scheme and illegal.

The federal government added the Social Security revenue into the general fund. FDR found a new way to fund his New Deal programs.

Experts like Abraham Epstein, executive director of the American Association for Social Security, saw this coming from the start. In an analysis for Harper’s magazine in December 1935, he wrote: “Large reserves are always in danger of being usurped by politicians for other purposes, as experience with other funds amply testifies.”

Democrat and Republican Congresses have spent the Social Security surplus many times over. Social Security holds paper IOUs as Treasury Notes that are part of the U.S. debt.

Presidents of both parties have tried to resolve Social Security’s structural issues. They appoint bipartisan committees, consider the results, make proposals during the State of the Union, are met with political opposition, and nothing happens.

In 2001, three Clinton administration officials (assistant treasury secretary David Wilcox, Douglas Elmendorf, a deputy assistant treasury secretary; and Jeffrey Liebman, an aide with the National Economic Council) presented a report that Clinton told advisers “he wanted to make strengthening Social Security one of his top goals for his second term.”  

The report shows that although members of his administration strongly opposed individual accounts, Clinton leaned in favor of them.

After taking office, George W. Bush appointed a bipartisan committee to recommend how to modernize Social Security. 

After public hearings, the panel largely endorsed voluntary private accounts for younger workers. Democrats in Congress howled. After winning re-election, Bush made Social Security his top domestic priority. Allowing younger workers to invest part of their Social Security in personal accounts was a major focus in his 2005 State of the Union address. It tanked.

Impeachment derailed Clinton’s focus on Social Security. Bush’s Social Security plans were already under fire when Hurricane Katrina struck. The Iraq War dragged on, followed by the beginning of the housing bubble burst, the banking crisis, and the Great Recession. At that point, Bush could no longer effectively move legislation.

In 2010, Barack Obama appointed the National Commission on Fiscal Responsibility and Reform (The Simpson-Bowles Commission). One of its six recommendations was to Make Social Security sustainable by lowering benefits for higher-income earners. Increase the standard retirement age to 69 by 2075.  Pay Social Security taxes on the first 90% of income up to $190,000 ($168,000 at the time). Workers who have paid into the system for at least 25 years are guaranteed a minimum payout of 125 percent of the poverty level. Use the Consumer Price Index to measure cost-of-living increases for recipients. 

Obama asked for changes in the method for computing cost of living (COLA) increases. In 2016, he changed his mind and backed an expansion of Social Security. 

Maintaining the program can go unchanged — or that taxing only the top one percent will fix it — makes Biden the least honest of these presidents regarding Social Security. The headlights of the oncoming train are getting closer. It doesn’t help for Joe Biden to demagogue making changes to Social Security.

During the 2023 State of the Union, Biden said, “anybody who doubts it contact my office.” Well, here’s the “fact sheet” you’ll get: “Congressional Republicans’ Many Proposals to Cut Social Security and Medicare, and Increase Prescription Drug Prices and Health Care Premiums.” 

Although this article only deals with Social Security, the entire statement is false.

It continues saying Biden has taken action to protect Social Security. Ask Google, “What action has Joe Biden taken to protect Social Security”? All of Biden’s promises not to cut the program and all of his accusations that Republicans want to will pop up, but not one tangible action he has made as president. Although you will find an opinion piece in The Hill about the last time, Congress cut Social Security benefits in 1983, and Senator Joe Biden voted to cut them.

Biden’s beef with Rick Scott is as follows:

“Florida Senator Rick Scott is championing a plan to put Medicare, Medicaid, and Social Security on the chopping block every five years, which would put the health and economic security of 63 million Medicare beneficiaries, 69 million Medicaid beneficiaries and 65 million Social Security beneficiaries at risk.”

Sheesh! Biden (or the White House) refers to a twelve-point plan that Scott released a year ago called Rescue America. It includes a proposal to sunset federal legislation every five years, forcing Congress to eliminate ineffective wasteful programs. Scott says he never intended to include Social Security or Medicare. He has rewritten the proposal to make that clear.

In theory, this is a good idea. As Ronald Reagan said, “A government program is the nearest thing we’ll ever see to eternal life on this earth.” In 2006, while I was working in Congress, it rescinded a tax (on wealthy people) who had telephones, established in 1898 to finance the Spanish-American War but was never repealed.

It’s time for Democrats and Republicans to get together and fix Social Security. I’ll let somebody far more eloquent than me explain the options.

“We can raise payroll taxes again, which nobody wants to do because the payroll tax is regressive. We can cut benefits, or we can work together to try to find some way to increase the rate of return to make it more possible for people who have paid into the system to get a little more back. But these are the three options.” — Bill Clinton, February 17, 1999.

Andy Bloom is president of Andy Bloom Communications. He specializes in media training and political communications. He has programmed legendary stations including WIP, WPHT and WYSP/Philadelphia, KLSX, Los Angeles and WCCO Minneapolis. He was Vice President Programming for Emmis International, Greater Media Inc. and Coleman Research. Andy also served as communications director for Rep. Michael R. Turner (R-Ohio). He can be reached by email at andy@andybloom.com or you can follow him on Twitter @AndyBloomCom.

8 thoughts on “Andy Bloom: The real deal on Social Security”

  1. Andy Bloom,

    Thank you for the concise summary of the problems, history involved, and potential solutions.

    Mike Sweeney
    Havertown, PA

  2. Rick Scott wanted to force a vote to recertify Social Security every five years. Of course he eventually backtracked after he realized how deeply out of touch his far-right plan was with the American people. If you’re actually committed to saving social security, why would he even attempt that and why would ANY radical right-wing regressives in the GOP have supported it?

    Now as far as numbers go: I wonder if we’d be able to spend more on Americans first if we hadn’t let Reagan triple the national debt, thrown 11 Trillion dollars at the Republican started invasions in the middle east, or allowed Trump to add a record shattering 7 trillion to the national debt in only 4 years. But sure, just like clockwork the Republican Party talking points shift to virtue signaling about “fiscal responsibility” again as soon as a Democrat is president.

    1. One point to make first – the NDAA, the National Defense Authorization Act which funds the military has to be renewed by Congress every two years. When was the last time that the Congress ever voted not to appropriate Defense spending? So, the argument about Rick Scott’s proposal doesn’t hold much water when embedded programs like Social Security and National Defense are concerned.
      Regarding the impact of the growing national debt has Social Security is also misconstrued. Social Security has a dedicated funding source. The issue is that the Democrats and the Republicans together borrow from that dedicated source and do not repay it. The Social Security “trust fund” is essentially a stack of IOUs issued by the Treasury to the Social Security Administration coupled with its current tax receipts.
      The cap on taxable wages is a reasonable thing to investigate. I believe that it should be lifted from the current $160,200 to at least $250,000 (if not higher) and then the benefits paid should be means tested at the upper end (monthly payments to recipients over the current $3,627. We tax all of the wages for Medicare, why cap Social Security taxes at the relatively modest level? Speaking of Medicare, we should seriously consider raising the 1.45% tax on wages there to help that fund out as well.

    2. You lose all credibility with comments like these. The ONLY president to pay off the national debt was Andrew Jackson. Reagan didn’t create it. When he left office, the national debt was 51% of GDP. Let’s look at when debt really exploded: When Obama took office, the national debt was approximately $10.6 trillion, or approximately 74% of GDP. At the end of his presidency, the national debt had nearly doubled to $19.9 trillion, approximately 104% of GDP. These are U.S. Department of the Treasury figures.

      Rick Scott’s proposal was not aimed at SS or Medicare, which easily would survive a Congressional vote every five years, or every year for that matter, much like the Defense authorization bill that Frank points out. BTW, part of the reason that the debt increased so much during Obama’s tenure is he didn’t cancel operations in Iraq or Afghanistan, despite his 2008 campaign promises. Further, for all the “hate” liberals muster against Trump, as a percentage of GDP, the national debt increased from approximately 104% at the end of Obama’s presidency to approximately 107% at the end of Trump’s presidency. When it came to debt, Trump was a piker.

      It might be time for a name change, Cicero.

  3. You said, “Democrat and Republican Congresses have spent the Social Security surplus many times over. Social Security holds paper IOUs as Treasury Notes that are part of the U.S. debt.”
    I assume you know that the two Parties you are discussing are named the Republican Party, and the Democratic Party.
    There is no party named the “Democrat” Party. Disappointed. Think more of you than this. How can you think that your arguments can be considered anything but partisan blather, when you go there? Disappointed.

    1. If you want to split hairs over my labels of the Parties, without commenting on the logic and content, then I’ve done a good job of presenting the case.

  4. Given the problems with the viability of Social Security and the demagoguery thus generated, I am concerned that ultimately this will lead to a war between generations. It matters little what kind of financial schemes are generated to make SS solvent, the basic and immutable structure of SS is a transfer of wealth between generations, namely the generation working to the generation retired. As workers are more and more required to fund the retirement of others, the more resentment will grow. Back in the mid 60s and later the 70s, various public pronouncements were offered to the effect that in order to save the environment, avoid famine, have sustainable resources available, people should not live past 75. It was suggested that if not dying naturally, you should pull the plug voluntarily. Although this concept did not gain a lot of traction back then, it has raised its ugly head again, particularly among the one world folk. The irony is that as a solution of less people is advanced to reduce payouts from SS, the back end of less people paying into SS is overlooked. I am clear in my mind; I don’t want to see a “Logan’s Run” type of world.

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