Congress Allegedly Stole as Social Security Faces $20.4 Trillion Funding Shortfall

Social Security has supported the country’s senior workforce financially for more than 80 years. The program’s monthly payments helped 16.1 million seniors age 65 and over and 22.5 million other people escape poverty in 2020.

The Social Security Board of Trustees has published a comprehensive annual report every year since the first payments to retirees began in 1940, looking into the program’s past, present, and future solvency. The shortfall in long-term funding for the Social Security program is pegged at $20.4 trillion in the 2022 Board of Trustees Report.

According to an article published by The Motley Fool on February 20, 2023, by 2034, it is anticipated that the Old-Age and Survivors Insurance Trust Fund (OASI), which distributes monthly payments to 5.8 million survivors and 48.8 million retired workers, will have used up all of its asset reserves. If the extra capital accumulated since inception runs out, drastic benefit cuts of up to 23% might be required to keep payouts going through 2096 without any more cuts.

Despite a vast number of demographic variables being to blame for Social Security’s precarious financial state, Congress is frequently held accountable.

In addition to being backed by the federal government, Social Security’s $2.84 trillion in asset reserves (as of January 2023) are also earning an average interest rate of 2.338%. Social Security’s interest income on its asset reserves accounted for $70.1 billion of the program’s $1.088 trillion in revenue in 2021. An estimated $575.8 billion in total revenue is anticipated between 2022 and 2031 to come from interest income.

Americans can legitimately point the finger at Congress for the lack of legislative progress in this area.