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House Votes To Block Reallocation Putting The Disability Trust Fund In Jeopardy

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For more than two decades, Congress has been fully aware that in 2016 is would need to replenish the Social Security Disability Insurance Trust Fund in order to continue paying full Social Security Disability benefits for recipients. Despite this commonly known fact, on January 6, 2015, the House of Representatives adopted rules of procedure that bar the House from making a reallocation that would stabilize the Disability Trust Fund through 2033 without accompanying cuts to Social Security Eligibility, coverage, or benefits. The House adopted this rule the night before the vote, with no debate and no opportunity for input from the public.

The adopted rule only affects the House, not the Senate, and the House can vote to waive the rule’s requirements to allow reallocation, but they have unnecessarily blocked the simple and sensible way to take care of the shortfall which has been used before – reallocation.

Over the last five decades, on a bipartisan basis, Congress has repeatedly addressed shortfalls in both of Social Security’s two funds – the Old-Age and Survivors Insurance Trust fund and the Disability Insurance Trust Fund. A temporary shift of Social Security’s incoming revenues to the Disability Insurance Trust Fund – called reallocation – will extend the Disability Insurance Trust Fund’s solvency for almost two decades, without cutting coverage, eligibility, or benefits. This has been done without increasing taxpayer contributions and it has been done 11 times in the past, about equally in both directions – sometimes reallocating more to the Disability Insurance Trust Fund and sometimes more the OAS Trust Fund. Using reallocation, the solvency of the overall Social Security system stays the same, with the combined funds remaining fully solvent through 2033. See NOSSCR Social Security Forum, Volume 37, Number 1, January 2015.

President Obama’s proposed SSA budget for the fiscal year 2016 included a provision for a five-year reallocation, starting January 2016, to shore up the Disability Insurance Trust Fund. While it can be debated whether or not reallocation is a proper long-term solution, it is certainly a simple short-term solution that does not raise taxes and does not place disabled beneficiaries in jeopardy of losing their benefits.

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