Social Security Disability Insurance Program is Financially Unsustainable
September 8, 2015
Social Security needs a long-term solution as soon as possible. The 2015 Social Security Board of Trustees' report indicates that within the next year the disability fund will be depleted. In fact, the Disability Insurance (DI) trust fund has an increasing gap between the amount it receives and the amount it pays out, writes Veronique de Rugy of the Mercatus Center.
- The Disability Insurance fund has operated with deficits since 2009.
- Benefits have doubled between 1998 and 2014, from $70 billion to $142 billion.
- In previous years deficits were financed by government securities, accrued during years that Social Security was generating a surplus, but all stockpiles will be obsolete in year.
Possible policy options include short term solutions such as raising payroll taxes to cover the deficits, or shifting assets to cover the Disability Insurance fund. However, these are simple solutions to a complex problem and will result in even greater damage in the long run.
Source: Veronique de Rugy, "Social Security Disability Insurance Program is Financially Unsustainable," Mercatus Center, September 2, 2015.
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