Budget Deal 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.
This isn’t the first time the disability insurance program has run out of money, and it isn’t the first time Congress has kicked the can down the road. As recently as 1994, the disability insurance program was about to run out of money, and Congress increased the disability insurance payroll tax by 50 percent, from 1.2 percent to 1.8 percent. That increase was coupled with a stark warning that the disability insurance program was in dire need of additional reforms to sustain it over the long run.
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