Vol. 3, No. 4, 1977

Social Security Changes Necessary
Last Updated: 07/27/77
According to the most recent estimates of the trustees of the Social Security Trust Funds, expenditures for old age, survivors, and disability benefits will exceed income by about $5.6 billion during 1977. This is substantially higher than the $3.9 billion deficit that the trustees forecast one year ago. The trust fund for disability payments is expected to be exhausted in 1979, and the trust fund for old age and survivors benefits in 1983, unless something is done to increase the income of these funds in the near future. Furthermore, the problem is not simply short-ranged and caused by the recent high levels of unemployment and inflation. The social security system will have progressively increasing deficits year after year unless changes are made in the method of financing, the system for determining benefits, or both. The trustees estimate that over the next 75 years the average tax rate will have to be about 75 percent higher than the rate (including scheduled increases) provided for by current law to balance revenues and benefit payments.