Social Security Disability: Stuck in Gridlock

Posted on Sep 01, 2015

In the January issue of the Cuddigan Law newsletter, we reported that the Social Disability Trust Fund is running out of money which may force drastic cuts in benefits. If the trust fund is not replenished then the only money available to pay disability benefits will come from the part of payroll taxes allocated to disability.  This will not be enough money to pay benefits in full. Benefits will be cut by nearly 20%, because revenues will only cover 81 percent of scheduled benefit payments.

Cuts could happen as early as the latter part of next year, unless Washington acts.  Unfortunately for the nearly 11 million Americans who receive Social Security benefits, our politicians once again appear to stuck in gridlock with no solution in sight.

Social Security is actually composed of two separate funds. One is designated for disability insurance while the other is specifically for retirement benefits. President Obama and the Democrats want to redirect some payroll tax revenue from the retirement trust fund into the disability trust fund, a procedure which has occurred 11 times in the past.  Republicans in Washington oppose the transfer between funds. They say they want to reduce the federal budget and cut fraud and waste, which they believe permeates the disability insurance program. 

Because the future of Social Security is sure to be on the table during next year’s presidential campaign, both parties would prefer to have this issue resolved, but neither side has shown willingness to compromise and no new solutions are on the horizon. Absent an agreeable solution, both parties seem willing to “kick the can down the road.”

“The more time that they take, the less acceptable the changes will be because there needs to be adequate time for the public to prepare and to adjust to whatever changes Congress will make,” said Carolyn Colvin, acting commissioner of the Social Security Administration. “Remember, these are our most vulnerable population. These are the elderly who helped to build this country. These are the disabled who certainly did not wish to become disabled.”

We will continue to monitor and report on this vitally important issue.  If you would to be in the know about Social Security disability issues subscribe to our FREE monthly newsletter.  Just shoot an email to: [email protected] or you can reach us through the “Contact Us” page on this website.

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Timothy J. Cuddigan
Omaha Social Security and Veterans Disability Lawyer With Over 40 Years Experience