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Will Social Security Benefits get cut
27 Jul 2022

Will Social Security Benefits get cut

Post by drclixadmin

The result, according to Social Security Administration trustees say it is that either the payroll taxes must be increased or benefits must be reduced.

My message is that Social Security benefits will not be reduced. My assumption is that the payroll tax won’t be increased. However, it’s not 100% certain.

So, what happens if your Social Security trust fund runs out of funds? Here’s my best guess.

The members of Congress will note how it is true that the Social Security trust fund has been in surplus for a number of years. As the trust fund’s balance declines to zero, they’ll suggest to the Federal government that it loan the trust fund money and let it be reduced to zero. They will make use of funds from other taxes or borrowing to cover the gap. No one’s benefits will be cut.

There are two major aspects to consider when evaluating the viability of the Social Security trust fund. The first is that the trust fund is not real. The trust fund has the bonds of the federal government, which means it’s part of the funding by the government to another. The trust fund is surplus, which means that the Social Security program is lending money to the Treasury. If the trust fund dropped below zero, then the Treasury would lend money to the trust fund.

The most important thing is not the amount of money in trust funds, but if more money is coming in instead of going out. Or if more is being withdrawn, then it is coming in. If more money is being poured into the fund than it is going to, then the Social Security program is giving money to the rest of the federal government. If there are more dollars going out than it is getting in, then the other federal government is donating money to the trust fund.

As the article by Eyermann illustrated, the date when the Treasury began sending money towards the trust fund was around the year 2010, which was over a decade back. Each year, a portion of the money goes to the trust account from Treasury due to the fact that there is a change in the Social Security system is currently giving out more benefits than it takes in tax payments.

The amount in the Social Security trust fund is irrelevant. If it falls below zero and the Treasury continues to send the money to help pay the benefits.

The reason why they do be second major factor that needs to be considered: the popularity of this Social Security program. The amount of benefits it pays out and how much taxes it collects is solely a decision of the political class. Congress can increase benefits, decrease benefit payments, and even end the program altogether.

If the members of Congress were worried about the viability of the Social Security program, they could immediately take action. One of the things they could do would be to end the costs of living increases. This would help ensure that the trust fund balance is forever at a healthy level. It is also possible to cut down on the cost of living increases which are already generous. It is also possible to reduce the benefits by 5% right now in order to not have to reduce the benefits by 20% over 13 years.

These ideas aren’t even on the table. They are currently on the table. Why? Because the possibility of a reduction in benefits will be viewed as unpopular politically now and into the future. Trust funds are not a type of bank account that the owner could be unable to access funds. Its funds come from the Treasury since its expenditures are already higher than its revenue.

If benefits are reduced is a decision of the political class, and the politicians won’t make a decision to reduce Social Security benefits by 20 percent or any amount if there’s a better option. They could simply decide to borrow funds from the Treasury to pay for the deficit.

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