Although Social Security is expected to dip into its reserves this year, one lawmaker says the program is not broke and can sustain benefit payments over the next ten years.
“The fund had a surplus for decades and it’s going into a trust fund and we are going to start dipping into that trust fund,” Rep. Tom Rice (R-S.C.) said during an interview on FOX Business’ “After the Bell.”
The House Ways and Means Subcommittee on Social Security held a hearing Thursday that revealed the program will be forced to tap into its nearly $3 trillion trust fund for the first time since 1982.
“The projections are the trust fund will expire in 2034 under current assumptions,” Rice said.
The South Carolina representative said the report also revealed some positive news about the outlook for the disability trust fund which has been extended from 2028 to 2032.
“They’ve done it because actual economics, the growth in the GDP, is outpacing forecasts and the Social Security Administration is assuming a 2.4% growth over the next ten years,” Rice said.
The challenge surrounding America’s most important retirement security programs, Rice said, is dealing with U.S. taxpayer money that is supposed to go into Social Security but has been used to offset deficits in the general fund account.
“They put I.O.U’s in and they pay interest on those I.O.U’s [at higher rates] than they pay on the 10-year Treasury note,” he said.
Sixty-two million people, including 45 million retired workers, received Old Age, Survivor and Disability Insurance (OASDI) at the end of 2017.
“We will make this promise golden for our seniors,” Rice said. “We will make this work.”