Earlier this summer, a report by the Congressional Budget Office, in its 2021 Long-Term Projections for Social Security, stated that the Social Security Trust Fund is on track to become depleted in 2032, eleven years from now.
That listed date is a year later than the date listed in the 2020 version of the report, although it’s three years sooner than the date in the 2020 Social Security trustees report. It is also, of course, merely a projection.
Now, there’s an argument that Social Security’s funds could run out even sooner.
Brett Arends wrote for Marketwatch this week that Social Security could run out of money “within eight years,” according to an expert he quoted.
“It seems that the date of insolvency of SS has crept sooner—perhaps as early as 2029,” Olivia Mitchell, a professor at the University of Pennsylvania’s Wharton School of Business and director of their Pension Research Council, said on a recent podcast, as quoted by Arends.
“So that’s in eight years. And that’s partly a function of a lot of people who have lost their jobs, so they’re not paying in [to] Social Security. Some people have retired early, so they’re claiming earlier and therefore drawing down.”
Arends and Mitchell also noted that Social Security trust fund administration is late with their annual report about the condition of the trust fund. That would mark the first report of its kind since the start of the pandemic.
Of course, the depletion of the fund does not mean that Social Security will cease to exist before the decade is out, or even that benefits would be drastically cut. Congress could make changes to shore up Social Security’s finances, which it did previously, during the Reagan Administration. Social Security is a popular program, and politicians would be unlikely to want to face the consequences of failing to save it.
Arends addressed that in his column.
“Then there’s the odd crazy person who thinks we could, for example, save the system by making the richest people in the world pay tax like the rest of us, or just by running America’s biggest pension fund like pretty much every other pension fund on the planet,” he wrote. “Both of these weird, wacky, impossible ideas would put Social Security on a sound footing without raising payroll taxes or cutting benefits at all.”
Independently of whether Social Security is actually running out of money, many Americans worry that it is.
Nationwide’s 8th Annual Social Security Consumer Survey, recently run by the Harris Poll on behalf of the Nationwide Retirement Institute, found that “Seventy-one percent of American adults believe that the Social Security program will eventually run out of money.”
Stephen Silver, a technology writer for The National Interest, is a journalist, essayist and film critic, who is also a contributor to The Philadelphia Inquirer, Philly Voice, Philadelphia Weekly, the Jewish Telegraphic Agency, Living Life Fearless, Backstage magazine, Broad Street Review and Splice Today. The co-founder of the Philadelphia Film Critics Circle, Stephen lives in suburban Philadelphia with his wife and two sons. Follow him on Twitter at @StephenSilver.