Eight Years to Impact: The Social Security System Is Dying and No One Will Save You by Clayton Mitchell

The annual report from the Social Security and Medicare Trustees is a sobering reckoning. It is also a warning. 

According to the Trustees, the Social Security trust fund, the bedrock of American retirement security, will be insolvent by 2033. That is not a distant abstraction. That is when today’s 59-year-olds retire. And if nothing is done, retirees will receive an automatic 23 percent benefit cut under current law.

Put plainly, if this system is not fixed now, you are not going to receive what you were promised. This is not political hyperbole. It is math. And math does not lie.

The Old Age and Survivors Insurance trust fund, which pays benefits to most retirees, will be depleted in eight years. If temporary reallocation from the Disability Insurance trust fund occurs, that buys one more year, until 2034, before both are drained. At that point, every beneficiary will see a 19 percent across the board cut in benefits, growing to 28 percent by the end of the century.

The Committee for a Responsible Federal Budget warns, “Social Security is barreling toward insolvency. If policymakers fail to act, they will effectively be supporting a 23 percent across the board benefit cut for all retirees in just eight years.”

The scale of the imbalance is staggering. 

The Trustees project 3.6 trillion dollars in cash deficits over the next decade. Over 75 years, the shortfall grows to 26 trillion dollars in today’s dollars. The actuarial deficit has nearly doubled since 2010. You cannot wish that away.

Congressional inaction has consequences. Each passing year removes more policy options from the table. In 2010, the system could have been saved with modest adjustments. Now, restoring solvency requires the equivalent of a 22 percent reduction in benefits, a 29 percent payroll tax increase, or some combination. 

Wait another decade, and the pain becomes even sharper. A 34 percent tax hike. A 26 percent benefit cut. No room to phase in things gently. No time for people to prepare.

Social Security is not some discretionary social program. It is a contract between generations. Workers paid in, trusting that what they contributed would be there for them. But those promises were made without fiscal discipline. What began as a pay as you go system has been stretched by demographic realities, longer life expectancies, lower birth rates, and a shrinking ratio of workers to retirees.

The math no longer works. Today, fewer than 3 workers support each retiree. By 2035, that number falls to 2.3. Revenues have not kept pace with costs, and the shortfall widens every year. Social Security costs will rise from 14.7 percent of taxable payroll today to 17 percent by 2050, while revenues remain stagnant.

And while recent legislation like the so-called Social Security Fairness Act was passed with noble intentions, it made the problem worse. That law allows some workers to double dip between Social Security and separate state or local pensions, adding billions to the imbalance.

The Committee for a Responsible Federal Budget notes that “half of the deterioration in Social Security’s 75-year shortfall is due to the passage of the Social Security Fairness Act.” Another part of the shortfall is due to regulatory changes that made it easier to qualify for disability benefits and to demographic trends like lower fertility rates.

The worst lie told to the American people is the one that says reform is not necessary. That everything will be fine if we simply tax the rich or cut waste. Those slogans are political comfort food. The Trustees’ math tells a different story. You cannot solve a 26 trillion-dollar hole with bumper stickers.

Both parties are complicit. Democrats refuse to acknowledge that current benefit formulas are unsustainable. Republicans too often run from any mention of taxes. Meanwhile, the clock ticks and retirees will pay the price for Washington’s cowardice.

In truth, there are many options available. Lawmakers could gradually raise the retirement age. They could redesign benefits to better target those most in need. They could broaden the tax base or tweak the payroll cap. But they must act soon. Every year of delay means steeper cuts, higher taxes, or more abrupt changes. The window to implement thoughtful phased reforms is rapidly closing.

According to the Committee for a Responsible Federal Budget, “Delaying action until 2034 would increase the size of necessary adjustments by 15 percent. Changes to benefits for new beneficiaries alone would be insufficient to restore solvency to the program, even if benefits were eliminated entirely.”

If you are under 60, hear this clearly: 

• You will not receive the benefits you were promised unless something is done now. That is not speculation. That is federal law.
• When the trust fund runs dry, benefits are cut automatically. 
• Congress does not have to vote. No one has to pass a bill. It just happens.

But that fate is not inevitable. It is a choice. Policymakers can choose to act while time, flexibility, and political goodwill remain. Or they can continue to delay until a crisis forces their hand, at which point your future will be carved up by a butcher’s cleaver, not a surgeon’s scalpel.

We have a decade. Barely. The math is in. The alarm is sounding. The question is whether our elected leaders will answer it or continue to pretend that arithmetic is a partisan opinion.

If they do nothing, the trust fund will fail, and the promise of Social Security will fail with it. 

You paid into the system. You earned those benefits. But unless leaders act now, you will not get what you were promised.

And that is a promise from math… and math does not lie.

Who doubts me?

Clayton A. Mitchell, Sr. is a life-long Eastern Shoreman, an attorney, and former Chairman of the Maryland Department of Labor’s Board of Appeals.  He is co-host of the Gonzales/Mitchell Show podcast that discusses politics, business, and cultural issues.