Budget Deal Robs Social Security To Pay Disability, Again

The Associated Press
The Associated Press

One sticking point for conservatives in the latest budget deal is that it effectively robs money from an already ailing Social Security to make up for shortages in an all-but-broke and failing Disability Insurance program.

The problem begins here, as pointed out by Gail Buckner at Fox Business in July of this year.

Fast-forward to today and Congress is doing precisely what it has done in the past: using accounting gimmicks to transfer dollars without solving, in the case, the real problems behind disability funding. Instead of doing its job and being financially responsible, presumably, some later generation will be left holding that bag.

Disability Fund is Hurting

The Trustees did not change their outlook for the Social Security fund that pays Disability Insurance benefits, which has been on life support for years. The DI Trust Fund will run out of money sometime next year. Given the fact that this would result in an immediate 20% cut in benefits, this is one aspect of the report that might actually spur Congress to act.

Oh they acted all right, unfortunately, the same way as they have in the past.

None-the less, when this situation has arisen in the past, Congress simply ordered the Social Security Administration to shift money out of the Retirement Trust Fund and into the Disability fund.

That above is precisely what Congress and the White House are about to do again, as Daniel Horowitz notes at Conservative Review:

Now, with the DI program expected to face a 19% shortfall next year, Obama and Republicans plan to “borrow” the needed funds from the main Social Security program to make up for the shortfall. After all, the old-age benefits trust fund will only face insolvency in 2033 so there is time to kick the can down the road. I guess they figure that once we are diverting $141 billion from the original purpose of the program, why not throw in an extra $30 billion?

Who will be harmed most by these policies?

As Mark Levin noted in his book, Plunder and Deceit (p.44), “the rising generation and generations unborn are harmed most by these practices, particularly with massive generational transfer payments and debt accumulation.”

Additional information on this precise problem with the latest D.C. backroom deal that fails to resolve genuine problems facing America, merely kicking the can down the road so Congress and Obama can go play golf on the taxpayer’s dime, can be found here via The Daily Signal.

Budget Deal Kicks the Can on Disability Insurance, Robs $150 Billion from Social Security

The budget deal reached last night attempts to stave off depletion of the Disability Insurance (DI) trust fund at the end of 2016 by “reallocating” about $150 billion over the next three years from the Social Security Trust Fund to the Disability Insurance Trust Fund.

This infusion of Social Security revenues should keep the disability insurance program solvent through 2022, at which point we can expect lawmakers to rob Social Security yet again.

Congress has been kicking the can down the road on disability insurance reform for decades and 2016 should have been the end of the road—time for meaningful reform. Instead, policymakers want to provide a little more roadway for the disability insurance program by whacking off a portion of Social Security’s roadway.


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