Congress must pass Social Security legislation by late next year to prevent the Disability Insurance Trust Fund from running dry, a crisis that would trigger automatic 19 percent cuts in disability benefits for millions of Americans.
Congress must pass Social Security legislation by late next year to prevent the Disability Insurance Trust Fund from running dry, a crisis that would trigger automatic 19 percent cuts in disability benefits for millions of Americans.
“The pain would be immediate and immense, especially considering that the average disability benefit is only about $14,000 a year,” writes Phil LaRue, government relations director for The Concord Coalition, in a Washington Monthly guest column. “Imagine the difficulty of paying for groceries, housing and other needs while suffering a 19 percent reduction in income.”
Lawmakers disagree, however, on how to avoid this crisis.
Some suggest transferring money from Social Security’s Old Age and Survivors Insurance (OASI) Trust Fund to the Disability Insurance (DI) program, as was last done in 1994. But OASI now has serious problems of its own — problems that Congress, ideally, should also address soon.
“Because lawmakers have ignored past warnings and allowed a crisis to develop, some ‘reallocation’ of OASI funds into DI will likely be necessary come next year,” LaRue says. “However, this should be considered within the context of a larger discussion on how to bring the revenues and outlays of Social Security into balance.”
