Disability Blog

Social Security Disability Benefits May Be Cut by Nearly 20%

Posted February 2, 2015 by Tom Nash

Congress launch a backdoor attack on disabled Americans.Conservatives in Congress launch a backdoor attack on disabled Americans.

Every year Congress passes a gigantic bill which establishes rules for the upcoming legislative session. Generally this is a fairly routine process, but buried deep in this year’s bill is a rule that, unless it is changed, is a time bomb that will devastate Americans who are the most vulnerable — the disabled. The bottom line result is that Social Security disability benefits could be cut by nearly 20 percent at the end of next year.

Here’s how it happened: Social Security has two funds – one to pay old-age retirement benefits and the other to pay disability benefits. The two funds have routinely borrowed from each other as needed. This accounting procedure has been done 11 times in the past and even was done four times during the Reagan presidency. However, just one day after the new Congressional members were sworn into office, conservative Republicans passed a rule that prohibits any transfer of money to the Social Security Disability Trust Fund unless it is accompanied by “benefits cuts or tax increases that improve the solvency of the combined trust funds.” As the National Committee to Preserve Social Security and Medicare points out, “In practical terms, that makes the reallocation impossible; it mandates either benefit cuts across the board, which aren’t politically palatable, or a payroll tax increase, which isn’t palatable to the GOP.” Unless Congress acts to change this situation, the Social Security disability fund will run out of money sometime within the last three months of 2016. At that point, according to an ABC News report, ”the program will collect only enough payroll taxes to pay 81 percent of benefits.”

The Center on Budget and Policy Priorities called the rule an “attempt to pit retirement and disability beneficiaries against each other that misrepresents how the two funds operate,” and pointed out, “that the only reason SSDI is in funding trouble next year is that it got short-changed by the past two reallocations of funding between disability and retirement benefits.” Nearly every aging and disability organization, including AARP; the National Committee to Preserve Social Security and Medicare; Social Security Works; and the American Federation of State, County, and Municipal Employees have publicly condemned this back door rule.

Nearly 11 million disabled Americans and their families rely on the critical lifeline of Social Security disability benefits to put food on the table, keep a roof over their heads and often to pay for vitally important medications. Today, on average, SSDI recipients receive a monthly check of $1,165, which would plummet to $944 per month, if the Disability Trust Fund is not replenished. The projected cut in benefits would drop them below the national poverty level.

It is not a certainty that something this drastic will actually happen, but as Michael Hiltzik reported in the Los Angeles Times, “Reallocating (money to the Social Security Disability Trust Fund) would keep both the old-age and disability programs solvent until at least 2033, giving Congress plenty of time to assess the programs’ needs and work out a long-term fix.” Senate Democrats have sent a letter to Senate Majority Leader Mitch McConnell (R-KY) urging him not to go along with this disastrous rule change and to allow the reallocation. Congress also needs to hear from those who voted them into office – that’s you. If you oppose this rule which will cause a devastating reduction in disability benefits, contact your Congressional representative. For the phone number, email address and mailing address of your representative go to www.house.gov/representatives/find/ and enter your zip code.

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