New report shows Social Security benefit cuts projected by 2034

Federal agencies released the annual Social Security and Medicare Trustees Reports this week, revealing that Social Security will have to cut benefits by 2034 – one year earlier than previously projected – unless Congress does something to address the program’s long-term funding shortfall.

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The timeframe of the of the projected benefits cut was moved up one year due to the impacts of the pandemic.

Treasury Secretary Janet Yellen said the administration is committed to safeguarding the programs.

“Having strong Social Security and Medicare programs is essential in order to ensure a secure retirement for all Americans, especially for our most vulnerable populations,” Yellen said. “The Biden-Harris Administration is committed to safeguarding these programs and ensuring they continue to deliver economic security and health care to older Americans.”

The report was released by the Treasury in conjunction with the U.S. Department of Health and Human Services, U.S. Department of Labor, Centers for Medicare and Medicaid Services, and Social Security Administration.

“The Biden-Harris Administration’s commitment to building back better isn’t only about roads or bridges, it is also about rebuilding our promise of a secure retirement for America’s workers, retirees and their families,” Labor Secretary Marty Walsh said. “As our economy gets healthier, so do the trust funds that sustain Social Security and Medicare. We will continue working to deliver on the promise of financial security in retirement for all of America’s workers.”

Social Security Administration Acting Commissioner Kilolo Kijakazi said the projections in this year’s report include the best estimates of the effects of the COVID-19 pandemic on the Social Security program. The commissioner reiterated that Social Security will continue to play a critical role in the lives of 65 million beneficiaries and 176 million workers and their families.

Health and Human Services Secretary Xavier Becerra added that Medicare has been a lifeline for over 63 million Americans. Becerra said the Biden-Harris Administration is committed to ensuring the program remains available for future generations.

“The Biden-Harris Administration is committed to running a sustainable Medicare program that provides high quality, person-centered care to older Americans and people with disabilities,” Centers for Medicare and Medicaid Services Administrator Chiquita Brooks-LaSure said. “Medicare trust fund solvency is an incredibly important, longstanding issue and we are committed to working with Congress to continue building a vibrant, equitable, and sustainable Medicare program.”

Senate Finance Committee Chair U.S. Sen. Ron Wyden (D-OR) said the report provides another stark example of how this pandemic has further hurt the American worker and underscored the need to protect health care for the most vulnerable.

“According to the report that came out today, the Social Security trust fund will be depleted a year earlier than last projected. That means workers in the future will take a 25 percent cut in benefits, even though they’ll still be contributing to Social Security with every single paycheck. And while the projected depletion of the Medicare Trust Fund remains unchanged from last year’s report, this provides cold comfort to the millions of Americans who rely on the Medicare program for their health care,” Wyden said.

“Congress must work hand in hand with President Biden to ensure that Medicare and Social Security will keep the promises made to workers, seniors and people with disabilities to ensure a dignified retirement and high-quality health benefits,” Wyden added.