All those charts and narratives ascribing Social Security the top spender of federal monies—and, thereby, implying the prime cause of the U.S. debt—need debunking.
, $838.2 billion from Social Security’s separate payroll tax covered 84 percent of the $1,001.9 billion in operational costs during 2021. The other revenue sources were the routine interest paid on securities owned, the income tax on Social Security benefits, and $59.1 billion collected from the liquidation of some securities—a liquidation representing a small percent of the 2021 deficit.
Shortfalls are now predicted to happen regularly each year whereby reserves in the OASI trust likely will be depleted by 2034 if no reforms. Then only an estimated 77 percent of benefits due would be payable. But annual payments on securities cashed in isn’t á priori a dominant driver of deficits and debt, as the preceding paragraph reveals.
Aside from erroneously blaming Social Security for deficits swelling the debt, there is also a related and persistent argument that cutting benefits viathe retirement age to 70 is necessary to control expenditures given the increasing life expectancy over the decades. But issues around life expectancy, ironically, actually contribute to disproportionate harm incurred by raising the retirement age again.
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