Social Security Trustees Release Annual Report to Congress

Long-term financing challenges remain

WASHINGTON, D.C – The Social Security Board of Trustees, a six member bipartisan panel that oversees the financial operations of the Social Security Trust Funds Administration, released their 2007 Trustees Report Monday, reinforcing predictions that Social Security cannot pay full promised benefits to future generations, due to our country’s changing demographics.

“This report reminds us of why Social Security reform and overall entitlement reform is so important,” said U.S. Rep. Ron Lewis (KY-02), a member of the Ways and Means Social Security Subcommittee. “The facts of this report are undeniable. Millions of baby boomers are nearing retirement while the costs necessary to sustain Social Security and Medicare are growing exponentially. This report should refocus our concern and reinvigorate our efforts to address the serious challenges these programs face.”

The Trustees report warns that Social Security tax revenue will fall short of benefit costs beginning in 2017. By 2041, with trust fund revenue exhausted, Social Security will be sufficient enough to finance only 74 percent of promised benefits. The Trustees project that benefits will have to be cut 27%, or the payroll tax will have to be increased by 50%, to pay full promised benefits.

“This is not a Republican or Democrat issue, it’s an American issue,” said Lewis. “The choices without reform are stark: massive benefit cuts, enormous deficits, or huge tax increases. We should not leave these problems for our children and grandchildren to solve.”

Lewis recently introduced the Social Security Guarantee Plus Act, legislation that would keep the Social Security safety net intact. The Guarantee Plus plan incorporates three core principles: all workers are treated fairly; individuals own and control their own retirement funds; Social Security benefits are guaranteed in full to all Americans through the next 75 years and beyond without increasing taxes, lowering benefits or raising the retirement age.

“Those of us in Congress must put partisan politics aside and do what’s best for today’s seniors and tomorrow’s retirees. Recent history shows that comprehensive reform is possible. Congress needs to work together to explore every possible option to restore confidence in Social Security and ensure the solvency of our most important entitlement programs.”