Report: Social Security will run dry by 2033, unless Congress acts

2033 is the year Social Security trustees predict that the Social Security trust fund will run dry. According to a study released on April 23, “Projected long-run program costs for both Medicare and Social Security are not sustainable under currently scheduled financing, and will require legislative modifications if disruptive consequences for beneficiaries and taxpayers are to be avoided.”

Bloomberg News reported that this date is three years sooner than a previous projection by the Social Security trustees, which include officials such as Secretary of the Treasury, Timothy Geitner, as well as Secretary of Labor, Hilda L. Solis, and Secretary of Health and Human Services, Kathleen Sebelius.

Disability insurance, which serves 11 million people, is projected only be able to run through 2016, two years earlier than previous projections.

The report cites that “due to factors that include population aging as well as the growth in expenditures per beneficiary,” the existing programs and methods of paying for them are no longer viable long term, and that financially solvent.

The report concludes that “Lawmakers should address the financial challenges facing Social Security and Medicare as soon as possible,” adding that “taking action sooner rather than later will leave more options and more time available to phase in changes so that the public has adequate time to prepare.”

The issue of retirement programs reform will be central to both parties in the bid for the presidency this year. House Republicans “propose replacing Medicare with government subsidies to help seniors buy private insurance,” writes Bloomberg. The Democrats and the Obama administration on the other hand, favor a plan to shore up the program.

“Neither side has offered a plan for Social Security, which at a 2011 cost of $736 billion is the U.S. government’s largest single program.”

Likely Republican presidential nominee, Mitt Romney, supports raising the age limit for Social Security benefits, and also favors House Republicans’ plan with Medicare.

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