In a move that shocked many, AARP said on Friday that it’s willing to support cuts in Social Security over the “the long term” to shore up the program’s finances while stressing its opposition to any benefit changes as part of current efforts to slash the federal debt.
“We are open to talking about different options to strengthen Social Security for the long term” including “changes on the benefit side,” David Certner, the group’s legislative director, said in an interview with Bloomberg.
The announcement comes after a report from the Obama administration showed that Social Security trust funds are projected to be drained in 2036, one year earlier than the last estimate. Once the trust funds are exhausted, both programs can only collect enough money in payroll taxes to pay partial benefits, the report said.
AARP said it favors lifting a cap on the payroll tax that funds the government program, though it’s willing to accept benefit cuts too.
Chief Executive Officer A. Barry Rand said in a statement on Friday that “any changes would be phased in slowly, over time, and would not affect any current or near-term beneficiaries.”
“It has long been AARP’s policy that Social Security should be strengthened to provide adequate benefits and that it is sufficiently financed to ensure solvency with a stable trust fund for the next 75 years,” Rand’s statement said.
In reaction to AARP’s statements, organizations like the National Senior Citizens Law Center said such a move would be a serious mistake.
“Any cuts would have dire consequences for millions of older Americans who are already living on the edge of financial disaster,” said the group in a statement. “What is often ignored in policy discussions about this strategy is that for two-thirds of older Americans, a modest Social Security benefit averaging $1179 a month, is more than half of their income.”
NSCLC said that any cut in benefits when the nation is “seeing increasing numbers of elderly among the homeless population would create far more problems than it would solve.”
In other social security news, the Administration made $6.5 billion in overpayments to people not entitled to receive them in 2009, including $4 billion under a supplemental income program for the very poor, a government investigator said Tuesday.