Social Security’s trust fund reserves were projected in the 2022 Social Security Trustees Report to become depleted in the future, potentially leading to a forced 20 percent cut in payable benefits in the 2030s unless legislative changes are adopted to prevent it. Assuring that Social Security stays strong means that Congress would need to evaluate very different reform options with complex and wide-ranging impacts–options such as making higher levels of income subject to the portion of payroll taxes dedicated to Social Security or raising Social Security’s normal retirement age–and then pass the reforms it chooses so that they can become law. How would you address the solvency issue? In the Academy’s Social Security Challenge, develop your proposed reform approach by traveling through a virtual town where you’ll learn residents’ different views on reform ideas and information about their impacts, and puzzle through choices. In the Challenge finale, select and submit your approach from a palette of possible reform options and see how well it works to address the solvency issue.
I suppose for the average american, watching a bunch of short videos is educational. For me I found it a little annoying to jump through a few hoops to find the actual SS game.
Still wish there was some political will in DC to deal with this.
When the video starts, you can click the scroll bar at the bottom to get to the end. Then you have to pass through a few slides until you get to a map of a small town.
Clicking on most of the locations in the town brings up another set of slides. You need to click on the Treasury looking building in the middle to find the actual game
More legal immigrants and fewer abortions would improve the projections of future Social Security and Medicare deficiencies. Neither seems likely. Most Americans don’t connect them, and too few see the deficiencies as a “current” problem.
If Medicare and/or Social Security deficiencies seem imminent, I think Congress will pass a bill that permits any gaps in their trust funds to be funded by emergency issues of T-bills (i.e., paid by general revenues). Virtually all congressmen will vote in favor.
I was crunching some numbers on the WEP and while the theoretical concept is solid, the math doesn’t math and assuming my quick calc was correct, it is overly punitive to affected middle class workers. It could do with a formula tweak, but killing it altogether is bonkers.
Obviously killing it is simpler though.
I was imagining three workers: one who truly averages $80,000, one who truly averages $40,000 and one whose averaged indexed earnings are $80,000 but only half are Social Security eligible so his AIME equals the $40,000 guy.
It’s fine to say he should have a lower benefit than the $40,000 guy because he’s getting a generous pension on top and he wasn’t participating in Social Security so his SS earnings don’t reflect his real income.
But I can’t see lowering his benefit to less than half of the $80,000 guy. And the formula absolutely does this. His monthly benefit goes from like $2,780.00 to $1,155.80.
Now how do you come up with a better formula when you don’t know how much the last guy actually made? Good question.
There was less outflow, but there was also less revenue.
THE EFFECT OF US COVID-19 EXCESS MORTALITY
ON SOCIAL SECURITY OUTLAYS
Hanke Heun-Johnson
Darius Lakdawalla
Julian Reif
Bryan Tysinger
Working Paper 33465
NATIONAL BUREAU OF ECONOMIC RESEARCH
1050 Massachusetts Avenue
Cambridge, MA 02138
February 2025, Revised March 2025
Abstract
The COVID-19 pandemic has resulted in significant direct and indirect excess mortality among
the US population, impacting the future outlays of the US Social Security Administration (SSA)
Old Age, Survivors, and Disability Insurance (OASDI) program. This study aimed to estimate
the net effects of pandemic-induced excess deaths on OASDI liabilities, utilizing dynamic
microsimulation models, and examined how these effects vary across different socioeconomic and
racial-ethnic groups. Data on excess deaths were obtained from the CDC and processed to account
for seasonal variations and demographic disparities. The simulation incorporated demographic and
health status variables to project OASDI retirement and disability benefits, and survivors’ benefits
for spouses and children, for respondents with highest COVID mortality risk. The pandemic
resulted in approximately 1.4 million excess deaths among individuals aged 25 and older between
2020 and 2023. These premature deaths mostly reduced future retirement benefits, which increased
the Social Security fund by $219 billion. Future disability benefit payments were reduced by $6
billion. However, these gains were partly offset by reductions in future payroll tax flows ($44
billion) and increased payments to surviving spouses and children ($25 billion), resulting in a net
impact of $156 billion. Non-Hispanic Black and Hispanic decedents left behind more underage
children per capita, yet payments to their surviving family members were lower compared to nonHispanic White decedents, across all educational levels. Excess mortality during the COVID-19
pandemic has complex implications for the OASDI program. While there is an estimated net
positive financial impact due to reduced future retirement benefits, this effect is mitigated by
decreased payroll tax contributions and increased survivors’ benefits. The differential impact by
race and ethnicity highlights existing inequalities and underscores the importance of considering
demographic disparities in future projections of Social Security liabilities. These findings provide
critical insights for informing SSA trust fund projections and policy decisions.
Short version:
Old age outflows reduced $219 billion
Disability program outflows reduced $6 billion
Tax inflows reduced $44 billion
Increased outflows to survivors increased $25 billion
Net result: +$156 billion, a drop in the Social Security bucket.
Over $1 trillion is paid out each year now, so that’s not even 2 months’ worth of benefits.