A report released on Monday found that the Social Security disability insurance trust fund will be depleted by 2016 and combined Social Security trust funds could dry up by 2033.
The report, which was written by the Social Security and Medicare Trustees, concluded that the result of the combined trust funds becoming insolvent would lead to a permanent 23 percent cut to benefits, according to a press release.
Sen. Rob Portman (R-Ohio) said the report indicated that programs like Social Security and Medicare won’t be available for future generations without congressional action.
“If we don’t tackle our nation’s budget challenges head on, then we’ll continue to see our entitlement programs barrel toward insolvency,” Portman, a member of the Senate Finance Committee, said. “This issue requires presidential leadership and bipartisan action, and (Monday’s) report should prompt those in Washington to act sooner rather than later.”
The report also concluded that Medicare would go bankrupt in 2030 at its current pace.
“This administration continues to ignore the fast-approaching crisis that Medicare and Social Security face – especially our Social Security disability program,” Rep. Dave Camp (R-Mich.), the chairman of the House Ways and Means Committee, said. “The fact is, without bipartisan action, benefits will be cut. It is time that Congress come together to enact some reforms so we can honor the security and benefits these programs provide our nation’s seniors.”
Rep. Jim Renacci (R-Ohio) said Social Security’s unfunded liabilities have climbed to $10.6 trillion, which is $1 trillion more than last year’s level. Additionally, Social Security’s shortfall added $80 billion to the budget deficit this year.
“As a CPA and former businessman, I came to Washington to bring a business perspective to an institution that sorely lacks it,” Renacci said. “We know that we spend more than we should, but the American people do not fully know the extent of our country’s dire financial situation. This is partly due to the fact that the Treasury (Department) leaves some of the largest liabilities, including Social Security, off of its balance sheet.”
Renacci authored the Federal Financial Statement Transparency Act, which would require “a more honest depiction” of the nation’s finances.
“A clean balance sheet will serve as a benchmark for the action that we must take to preserve our Social Security program for the seniors that rely on it and future generations,” Renacci said. “I am hopeful that my legislation will move through the legislative process quickly so that we can take the necessary steps to protect a program that Ohioans and Americans everywhere count on once they reach retirement.”