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What is the real question we should ask about SSD?

You may have noticed discussions pertaining to the Social Security disability insurance (SSDI) program due to the impending shortfall caused by the exhaustion of the SSDI trust fund. SSD benefits are currently paid from two sources. The majority of the revenue to pay the monthly benefits of the 11 million SSD beneficiaries comes from the FICA tax. A smaller portion has been paid from the SSDI trust fund.

This trust fund's depletion in 2016, however, is no surprise. While many inside and outside Congress like to characterize the exhaustion of this trust fund as a "crisis," the real element of crisis here is not the trust fund's exhaustion in 2016, but that Congress has failed to act for 20 years.

We typically think of a crisis as something that arrives unexpectedly and with which we suddenly have to deal, like a sudden illness. But this exhaustion is not a sudden occurrence; it was projected to arrive in 2016 back in 1995 trustees report. Congress could have "solved" this problem by implementing various solutions many times, most of which would require tax increases.

But because Congress has become adamantly opposed to even very reasonable and necessary tax increases, there is much hand-wringing and talk of the need to create "commissions" to "study" the problem. It is treated as if it were akin to curing cancer, as opposed to the couple of very simple arithmetic problems that it actually is.

To ask is SSDI going "broke" is really a nonsense question. If we were to end the FICA tax today, the "crisis" would become immediate. If we increased it by a few percentage points, the problem with SSDI and with SSA's retirement funds could be fixed just as quickly.

There are many things that can be done improve the operation of the SSD program. But first and most important is the securing of adequate funding for the benefits already in the program. The real question you should ask yourself is why Congress refuses to do this.

News-press.com, "Is social security disability nearly broke?" Lawrence Jacks, March 10, 2015

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