House Committee Holds Hearing on Administration Proposal to Defer Payroll Taxes

On September 24, the House Committee on Ways and Means Subcommittee on Social Security held a hearing on the President’s proposal to defer payroll taxes. Witnesses were Senator Ron Wyden (D-OR); Representatives Danny K. Davis (D-IL), Linda Sánchez (D-CA), Judy Chu (D-CA), and Don Beyer (D-VA); Nancy J. Altman, President of Social Security Works; Will Goodwin, U.S. Army Veteran and the Director of Government Relations for VoteVets; Amy Matsui, Director of Income Security and Senior Counsel at the National Women’s Law Center; Janice Dean; Max Richtman, President and CEO of the National Committee to Preserve Social Security and Medicare; and Robert Roach, President of the Alliance for Retired Americans. Visit the committee website for more information and to view video of the hearing.

The Arc opposes the recent executive order and resulting Internal Revenue Service rule that allows employers to temporarily delay payroll taxes and supports legislative efforts to rescind the rule. A delay in payroll taxes will cost the Social Security Trust Funds interest income and workers will still be required to pay the taxes later on. In addition, we share the concerns of the United States Chamber of Commerce and others about the administrative and financial burden that this delay will place on businesses and workers. The President has also made public statements advocating to repeal payroll taxes entirely. Social Security Disability Insurance and other Social Security benefits for people with disabilities rely on these payroll taxes and the Social Security Administration’s non-partisan actuary estimates that the Disability Trust Fund will run out of funds in 2021 and the other Trust Fund in 2023 if payroll taxes were repealed.

Social Security: House Committee Holds Hearing on Social Security Financing Bill

On July 25, the House Ways and Means Committee held a hearing on the Social Security 2100 Act (H.R.860). The bill would make Social Security benefits more adequate by providing a modest across-the-board increase, improving annual cost of living adjustments, and increasing the minimum Social Security benefit to 25 percent above the federal poverty line. Additionally, it would create a single Social Security Trust Fund to simplify Social Security’s operations and ensure that Social Security is able to pay full scheduled benefits for the next 75 years through modest enhancements to revenues. The Arc strongly supports the Social Security 2100 Act. Testimony from the hearing is available on the committee website.

Social Security: Trustees Release 2019 Annual Report Showing Extended Solvency

On April 22, the Social Security Board of Trustees released “The 2019 Annual Report of the Board of Trustees of the Federal Old-Age and Survivors Insurance and Federal Disability Insurance Trust Funds.” The 2019 report finds that at the end of 2018, Social Security’s reserves were $2.89 trillion. The Trustees project that Social Security’s combined Trust Funds can pay all scheduled benefits through 2035, at which point the Trust Funds would be able to pay approximately 80 percent of scheduled benefits. The Trustees also find that the Social Security Disability Insurance Trust Fund can pay full scheduled benefits through 2052, after which the fund will be able to pay about 91 percent of scheduled benefits. This is 20 years later than projected in the 2018 Trustees Report, due to ongoing declines in applications, awards, and the number of people receiving Social Security disability benefits.

Senate to Hold Hearing on Social Security Disability Trust Fund Insolvency

On Wednesday, February 11th, the Senate Budget Committee will hold a hearing on “The Coming Crisis:  Social Security Disability Trust Fund Insolvency”.  Social Security Disability Insurance was created in 1956 to provide financial assistance to people who are unable to work due to disability or health issues.   Witnesses at the hearing will include: Carolyn W. Colvin, Acting Commissioner of Social Security, Social Security Administration; Dr. Mark Duggan, Wayne and Jodi Cooperman Professor of Economics, Stanford University; Dr. Philip de Jong, Professor of Economics, University of Amsterdam – Amsterdam School of Economics; and Kate Lang, Staff Attorney, National Senior Citizens Law Center.  Visit the Committee website to learn more and to view live video on the day of the hearing.

Annual Trustees Report Released

Last week, the Social Security Trustees released their annual report on the current and projected financial status of the Social Security Trust Funds. The 2012 Trustees Report shows that Social Security is 100 percent solvent until 2033, but faces a moderate long-term shortfall. In 2011, Social Security had a surplus of $69 billion. Reserves are projected to grow to $3.1 trillion by the end of 2020. If Congress takes no action in the meantime, reserves would start to be drawn down to pay benefits. If Congress does not act before 2033, the reserves would be depleted and revenue coming into the Trust Funds would cover about 75 percent of scheduled benefits. The Arc supports proposals to ensure the long-term solvency of the Trust Funds that maintain the basic structure of Social Security, spread the costs, and are as minimal as possible.