Social Security retirement funds could be depleted by 2032, according to a new report by the Social Security Administration.
The report warns that unless Congress takes action, it will only be able to pay 78% of the current level of benefits.
There have been concerns over the long-term solvency of Social Security before. But experts who study economic and retirement policy say the systemic threats to the program may be more severe in the near future than they have been in the past.
"I am worried that this time might be different because in the past we had some difficult situations, but nothing nearly as large as what we're going to be dealing with in the early 2030s," said Charles Blahous, senior research strategist at the Mercatus Center at George Mason University. "Even if we were to try to act today to fix the system, we'd have to find savings equal to a 30% across-the-board benefit cut. That is not an easy lift. If we were to wait until the early 2030s to try to deal with it, the problem by that is just too large to resolve. So I fear we're heading into uncharted waters here, and that we may have a more substantial crisis that we've had in the past."
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"This has certainly been a dereliction of responsibility on lawmakers' part," Blahous said. "This could have been dealt with very easily and painlessly a couple of decades ago simply by making a slight adjustment to the rate of growth of the benefit formula. Probably no one would have noticed the change and that the problem would have disappeared. But they have dithered and delayed and procrastinated for so long that now we have a massive problem and it's going to be very difficult to solve it without someone's ox being gored in a pretty obvious way."
Watch the full interview with Blahous in the video above.
