Last week, the Social Security Board of Trustees released their annual report on the long-term financial status of the Social Security Trust Funds. The news does not continue to bode will for the long-term survival of Social Security — but on the other hand, this is nothing that we haven’t heard before. Unfortunately, no one really wants to tackle the problem of reform.
“The Social Security Board of Trustees today released its annual report on the long-term financial status of the Social Security Trust Funds. The combined asset reserves of the Old-Age and Survivors Insurance, and Disability Insurance (OASDI) Trust Funds are projected to become depleted in 2034, the same as projected last year, with 77 percent of benefits payable at that time. The DI Trust Fund will become depleted in 2028, extended from last year’s estimate of 2023, with 93 percent of benefits still payable.
In the 2017 Annual Report to Congress, the Trustees announced:
- The asset reserves of the combined OASDI Trust Funds increased by $35 billion in 2016 to a total of $2.85 trillion.
- The combined trust fund reserves are still growing and will continue to do so through 2021. Beginning in 2022, the total annual cost of the program is projected to exceed income. (emphasis added)
- The year when the combined trust fund reserves are projected to become depleted, if Congress does not act before then, is 2034 – the same as projected last year. At that time, there will be sufficient income coming in to pay 77 percent of scheduled benefits.
“It is time for the public to engage in the important national conversation about how to keep Social Security strong,” said Nancy A. Berryhill, Acting Commissioner of Social Security. “People understand the value of their earned Social Security benefits and the importance of keeping the program secure for the future.”
Other highlights of the Trustees Report include:
- Total income, including interest, to the combined OASDI Trust Funds amounted to $957 billion in 2016. ($836 billion in net contributions, $33 billion from taxation of benefits, and $88 billion in interest)
- Total expenditures from the combined OASDI Trust Funds amounted to $922 billion in 2016.
- Social Security paid benefits of $911 billion in calendar year 2016. There were about 61 million beneficiaries at the end of the calendar year.
- Non-interest income fell below program costs in 2010 for the first time since 1983. Program costs are projected to exceed non-interest income throughout the remainder of the 75-year period.
- The projected actuarial deficit over the 75-year long-range period is 2.83 percent of taxable payroll – 0.17 percentage point larger than in last year’s report.
- During 2016, an estimated 171 million people had earnings covered by Social Security and paid payroll taxes.
- The cost of $6.2 billion to administer the Social Security program in 2016 was a very low 0.7 percent of total expenditures.
- The combined Trust Fund asset reserves earned interest at an effective annual rate of 3.2 percent in 2016.
The Board of Trustees usually comprises six members. Four serve by virtue of their positions with the federal government: Steven T. Mnuchin, Secretary of the Treasury and Managing Trustee; Nancy A. Berryhill, Acting Commissioner of Social Security; Thomas E. Price, M.D., Secretary of Health and Human Services; and R. Alexander Acosta, Secretary of Labor. The two public trustee positions are currently vacant.”
View the 2017 Trustees Report at www.socialsecurity.gov/OACT/TR/2017/.