In 1971, the iconic songwriter John Lennon penned the lyrics to his famous song “Imagine,” asking us to picture a world in total peace and harmony. Although it was a call to imagine what life would be like in a utopian world, it was also, perhaps, overly optimistic given the realities of that time – realities which are largely similar today, over 5 decades later.
Nevertheless, it is always good to imagine life as it might be. And that goes both ways – we can and should always picture life in a better world, but we might also take pause, at times, to picture how life might be worse. How often have we lamented that “things could be much worse?” when confronting adversity in our daily lives? So, today I’d like to suggest that you picture what life would be like without Social Security.
First Some Statistics
First, some statistics: Social Security provides benefits to about 70 million Americans, senior citizens as well as those not yet old enough to be so designated. That’s about 20% of the entire U.S. population. The benefits offered are financial, providing usually crucial money to those fortunate enough to be eligible. That includes those who have earned benefits by working and are old enough to claim, and others – such as minor or disabled adult children – who have not personally earned a benefit but are dependent on a parent who has. Benefits are also available for dependent spouses, ex-spouses and, sometimes, dependent parents. And let’s not forget that even working Americans who become disabled often find financial relief at a younger age with the Social Security disability insurance program. Fact is, Social Security provides a “major” source of income for a majority of senior Americans and, in most cases, those collecting say it is critical to their ability to make their financial ends meet. In a nutshell, a large majority of Social Security recipients say Social Security is critically important to their financial well-being. But what if Social Security were to go away?
What If Social Security Went Away?
Well, that’s not something we like to think about because it would negatively impact so many millions of people. Senior citizens would suffer harshly because the poverty rate for those aged 65 and over would jump from around 10% to nearly 40%.That means another 22 million people would be added to the total 36 million who already live below the U.S. poverty line. And statistically, the ones most affected would be older women, people of color, and children (about 4 million of whom receive Social Security benefits). Another 9 million or so Americans who collect Social Security Disability Insurance benefits would also be seriously affected.
What would American life be like without Social Security? As a student of U.S. history, I can imagine what it was like in the 1930s – the decade of the so-called “Great Depression.” The years immediately preceding the advent of FDR’s Social Security program were a time of abject poverty in the United States. Many Americans had very little money and scant resources, with men wandering from town to town to find work to provide food for their kitchen table. Many wore tattered clothing, often the only clothes they had, and minor children had to work (if they could) to help the family survive. That was the environment which gave birth to the U.S. Social Security program. And the program, funded by taxes on workers and their employers, worked well. Starting when monthly SS benefits began flowing in 1940, Social Security has continued to sustain America’s seniors and their dependents for about 90 years. In other words, Social Security is an extremely effective anti-poverty program which, if eliminated, would devastate millions. But what are the chances that Social Security will actually go away?
Will Social Security Ever Go Away?
You might have heard that Social Security is now having some financial difficulties – and that is true. But is it in danger of ever going away completely? The answer to that is a resounding “No.” Despite its current financial dilemma, Social Security will never go away completely. As long as Americans are working and contributing to the program, it will always be here to provide some benefits. But the more important question is, will Social Security be able to pay for all of its benefit obligations in the future? And the answer to that is “No, unless Congress acts soon to reform the program.” You see, right now Social Security revenue (mainly income from working Americans) is less than needed to pay all benefit obligations. Social Security revenue in 2024 was about $1.418 trillion, but SS expenses were about $1.485 trillion – a deficit of about $67 billion. And that shortfall has been taken from Social Security’s Trust Fund reserves in order for full benefits to be paid to everyone.
The Social Security Trust Funds have supplemented the money needed to pay full benefits since 2021, which means the reserves in the Trust Funds have gone from about $2.9 trillion in 2020 to about $2.7 trillion today – a trend that will result in the reserves being completely depleted in about the year 2033 (this according to the Trustees of the Social Security program). If the Trust Fund reserves are fully depleted, Social Security can only pay out in benefits what it receives in revenue, which would mean about a 23% cut in benefits for every Social Security recipient.
Since so many Americans rely on Social Security as a major contributor to their financial well-being, the result of a 23% cut to everyone’s Social Security income would be devastating. It likely wouldn’t make things as bad as they were in the 1930s preceding Social Security’s birth, but it would nevertheless present a very serious problem which would thrust many more Americans into poverty. And that is the crux of the Social Security dilemma – cutting everyone’s SS benefit to only 77% of what is now received would mean a return to high levels of American poverty.
But it doesn’t need to happen.
Fixing Social Security
Congress has been aware of this looming Social Security issue for several decades but has chosen to “kick the can down the road.” Now, there is little time remaining to fix the problem. We are only a short 7 years away from when the SS Trust Funds will no longer have money to supplement Social Security benefit payments. Therefore, Congress must act soon to restore this crucial program to financial solvency. And the longer Congress waits, the more difficult the problem will be to solve. Indeed, Congress, instead, recently exacerbated Social Security’s financial dilemma by passing legislation which provided additional benefits to a segment of beneficiaries (see H.R. 82 – The Social Security Fairness Act). Regardless of the merits of that recent legislation, it added about $200 billion to Social Security’s expenses over the coming decade, at a time when Congress should be seeking ways to reduce Social Security’s costs.
For its part, the Association of Mature American Citizens (AMAC) recognized this looming Social Security issue years ago and developed a potential Social Security reform proposal. AMAC has promoted (and continues to promote) its Social Security Guarantee to Congress and, in fact, also to the new Commissioner of Social Security. AMAC’s proposal provides common sense adjustments to the Social Security program – program adjustments which retain the poverty-reduction aspects of Social Security while still providing the full benefits all have earned from a lifetime of working. You can see a summary of AMAC’s Social Security Guarantee proposal here.
In any event, now is the time to mobilize by contacting your Congressional Representatives to demand that Congress take action to reform the Social Security program and restore it to financial solvency. The year 2033, when everyone’s Social Security benefit will be cut by almost 25%, is just around the corner! Just imagine the consequences of that!!
This article is intended for information purposes only and does not represent legal or financial guidance. It presents the opinions and interpretations of the AMAC Foundation’s staff, trained and accredited by the National Social Security Association (NSSA). NSSA and the AMAC Foundation and its staff are not affiliated with or endorsed by the Social Security Administration or any other governmental entity. To submit a question, visit our website (amacfoundation.org/programs/social-security-advisory) or email us at [email protected].
When i was younger, I would had loved the idea of opting out of this ponzi scheme. FICA or the Federal Insurance Contribution Act was manditory and my so called contributions always seemed to increase whenever the government decided. Strangely politicians were not participants in this new tax along with certain federal workers. As for ordinary people most would have piddled it away instead of wisely investing in their future. It probably was a good idea for the mass of shortsighted people. But Social Security was never meant to be a major source of income and to become dependent a government run program is a scary prospect as evidenced by the constant insolvent rumors that continue to circulate. For those that paid in over the decades, this is not an entitlement, it’s our payback, only the government didn’t expect to actually make good on it.
The demoncrats are the ones who keep trying to scare people by saying republicans are going to get rid of social security. The truth is, the liberals have destroyed social security. What was originally intended (I presume) to be for people who work their entire lives then retire. They were supposed to have money that was taken from their paycheck given back to them. The problem is that money was given to someone else, namely people who refused to work and decided to become leeches. It was also given to illegal who never worked for it. When the demoncrats claim the SS system could go bankrupt they are correct but it is because THEY have abused the system by giving it to people who have NOT earned it. Why are illegals getting free medicare when I, an American citizen, have to pay for it? Why do illegals and those who refuse to work get free health care…that I have to pay for?
Social Security should have been privatized long ago. If it had been, retirees would have more money to retire on. Instead, we still have to live paycheck to paycheck and we have to work longer in order to get full benefits. That simply is not right! People over 60 should not have to pay ANY taxes, either…federal nor state. And that includes property taxes even if our home is not fully paid off.
Social Security should have been privatized in the ’80’s when Reagan suggested it and when the baby-boomers were still working!
What about all of the fraud that has been outed since Musk and Trump worked on wasteful government spending. Is someone still working on this? What about all of the people on SSI for disabilities they really do not have? Many of these people have attorneys who do nothing but handle these types of cases. Billions of dollars are wasted on this type of fraud. If that were stopped, would not that help keep the program alive? Why do we not hear of people being arrested and charged for all of the fraud?
Yes, I’m one of those people who lacked foresight and because I got divorced and had to pay a couple hundred thousand dollars in child support I wasn’t able to save any money for retirement. Now I fully depend on social security to pay all my bills. I’m lucky to have my house and car paid off so my monthly check covers everything. But a 23% reduction in my monthly check would make it impossible for me to pay everything. I would end up going hungry or lose my house for not paying property taxes, etc. So I’m trying to find some way to supplement my social security now because I know very well that congress is not going to be able to get their act together to fix things in time. Must be nice to get paid $174,000 a year (base salary plus perks) for doing pretty much nothing.
They need to split the program in 2. Keep paying benefits for those currently receiving them and keep the for people age 55 and over. Start a new program for those under age 55 and for any one age 55 or over who wants to opt in. The new program would be sorta of like a Trump Account where your current FICA Tax amount is placed in a “IRA” that you can’t touch until a least age 62. The employers FICA amount would go to funding the system containing current payees.
Social Security was designed to never go broke, the problem is the no good Democratic Party stealing the money for people who don’t deserve it! The Democratic Party have done everything they can do to destroy our country!
Imagine a world without soc. sec. Do you not realize the millions of millionaires there would be here in America if you had invested the same amount of money in the stock market. This includes me. Do you not realize none of us were supposed to collect SS. I have not been able to find out what the expected life span of a man was when they voted in the SS Act in the 1930’s. Now, all we hear is SS is going broke. This was a ponsey scheme when it was set up. They established the retirement age of 65 years & set it up in a trust fund. Then the dem. party got a liberal supreme court to say, this is a tax. Then they began stealing million & millions of dollars from this fund & we are told we must participate. How many of you are aware the set up the program so you could choose if you wanted to be apart of it. I would not been in this program had this been an option when I began working in the 1950’s.
I doubt that there would be a problem if Social Security kept to its mission — providing funds to those who contributed throughtout their working lives. Disability benefits are an overused, abused joke. I have always paid for disability insurance with deductions from my paychecks. Why isn’t that money used ? Survivor benefits for the elderly are one thing, but why should children get benefits if their parent dies? Why don’t surviving spouses with kids have to get a job and support their families? This is all nonsense designed to keep the leeches hooked on government money for doing nothing.
Actually, you did not imagine no socialism the benefits we would enjoy without it, or the welfare of those addicted to a system encouraging sloth.
Yup!
We had NO choice!
Getting down to it, it IS, a ‘Ponzi Scheme’
George ‘W’ had a plan, but it was rejected by the ‘LEFT’, Because, simply, it wasn’t their IDEA!
AMAC has to get better writers. Who in his right mind would recommend Imagine as a good song? It may be one of the worst songs ever written.
Who would recommend this song? Someone who thinks social security is a good thing. It is a Ponzi scheme and should have been privatized a long time ago.
Why worry , with a 40 Trillion Dollar Deficit our Country is Bankrupt .
Social Security is legalized wage theft. It should he abolished and all of the people actively collecting should be forced to pay back what they have stolen from American workers.