Opinion: G.D. Washington

In recent weeks, Republicans in Congress have put forth a plan to address the pressing issue of the Social Security Trust Fund. Their proposal includes gradually increasing the retirement age from 67 to 69. While this idea has faced immediate opposition from President Joe Biden and top Democrats, it is crucial to recognize that raising the retirement age may become essential for the long-term health and sustainability of Social Security.

The current state of Social Security is cause for concern. In 2020, the program experienced a shift, with revenue no longer exceeding benefit payouts. The federal government now expects Social Security to take in $1.17 trillion this year while paying out $1.32 trillion. This $150 billion shortfall will be covered by drawing down on the program’s $2.63 trillion trust fund.

While $150 billion may seem manageable, the problem only grows larger with each passing year. By 2032, it is projected that benefits will surpass revenues by approximately $500 billion annually. If we take no action, the Social Security Trust Fund will be depleted by 2034, triggering a 23% across-the-board cut in benefits to maintain a balance between incoming and outgoing funds.

Raising the retirement age to 69 presents a viable solution. According to analysis conducted by the Committee for a Responsible Federal Budget, this adjustment would align the annual growth of Social Security costs with the annual increase in revenue by 2030.

Raising the retirement age is not an unprecedented move. According to Bloomberg, in 1983, when Social Security last faced an insolvency crisis, Congress passed a bipartisan solution that included raising the retirement age from 65 to 67. This adjustment acknowledged the reality of increasing lifespans. The same rationale holds true today.

From 1950 to 1980, the life expectancy of 65-year-olds increased by 2.5 years. From 1980 to 2019, it increased by an additional 3.2 years.

While President Biden proposes extending the life of Social Security through tax increases on those earning over $400,000 annually, this measure alone would not cover the current year's shortfall and would only provide a temporary extension of solvency. In contrast, raising the retirement age would generate savings that increase over time.

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Stabilizing the finances of Social Security has long been a complex task for Congress. The most successful effort to date was the 1983 reform, which recognized the need to raise the retirement age due to longer lifespans.

Biden and leading Democrats must acknowledge the reality that the same holds true today, even if it poses challenges to their re-election campaigns. It is the least detrimental option available to ensure the long-term sustainability of Social Security, safeguarding the retirement security of all Americans.