The Social Security trust fund will become unable to pay scheduled benefits to retirees and the disabled as soon as 2034, new projections show — one year earlier than last year’s estimates.
The reports out Wednesday from trustees of Social Security and Medicare funds ramp up the urgency to find a solution to the growing gap between contributions and benefits — or else today’s 59-year-olds will see an automatic 23% benefit cut when they reach full retirement age.
The Medicare trust fund that covers seniors’ hospital care is also expected to be depleted in 2033, triggering an 11% cut in payments to hospitals and other facilities.
The worsening outlook reflects economic, demographic and legislative changes — and, critics say, a lack of political urgency from the White House and Congress.
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“Congress seems more intent on cutting taxes and scoring political points than rescuing these programs from the brink,” said Maya MacGuineas, president of the Committee for a Responsible Federal Budget. “Where is the sense of urgency? It’s time to start telling the truth when it comes to Social Security and Medicare.”
Deeper hole
Some of the deterioration in Social Security’s finances stems from the Social Security Fairness Act, passed with bipartisan support in Congress and signed into law by former President Joe Biden in January.
That measure repealed two long-criticized provisions — the Windfall Elimination Provision and Government Pension Offset — that reduced benefits for certain public-sector workers, such as teachers and police officers, who spent part of their careers outside the Social Security system.
The projected 75-year deficit has now widened to 3.82% of taxable payroll, up from 3.50% just a year ago.
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Demographics are also working against the system. Projected fertility rates are now lower than trustees had previously anticipated, meaning fewer workers will support a growing number of retiring Baby Boomers.
During his campaign, President Donald Trump pledged not to cut benefits and floated a plan to eliminate taxes on Social Security benefits.
After taking office, he directed the Department of Government Efficiency to scrutinize the Social Security Administration for evidence of widespread fraud — a hunt that came up mostly empty. Billionaire Elon Musk, who led the DOGE initiative until May, claimed the trust funds could be stabilized by rooting out waste and abuse alone, a view not supported by the trustees’ data.
Under current law, Congress cannot make changes to Social Security via expedited budget reconciliation process such as the one now being used to shepherd Trump’s “One Big, Beautiful Bill” of tax and spending cuts through Congress.
