This week, Social Security trustees issued their annual report on the program’s financial health. The news was expected: Social Security will be able to pay full benefits to Americans currently receiving benefits and those new to the system for the next 21 years—until 2033. After that, if there are no new revenues added (an unlikely proposition), recipients will still receive three-quarters of their benefits. Previous trustee reports had indicated that the system would have paid full benefits until 2036, but the recession and slower wage growth led to the revised projections.
In discussing this year’s numbers with the press, Social Security Commissioner Michael Astrue warned reporters:
Please remember that ‘exhaustion’ is an actuarial term of art and it does not mean there will be no money left to pay any benefits. After 2033, even if Congress does nothing there will still be sufficient assets to pay about 75 percent of the current level of benefits. That’s not acceptable, but it’s still a fact that there will still be sufficient assets there.
With a few exceptions like USNews.com, the ABCNews blog, and Mark Miller, who noted on his Reuters blog “Astrue went out of his way to emphasize that the program is far from broke,” Astrue’s warning went unheeded.. Most press coverage ignored Astrue’s cautions and left the impression with the public that Social Security will not be there for them. “There won’t be much money left for you” after 2033, declared a reporter on WBEZ in Chicago.
The public got plenty of doomsday headlines: “Social Security (is) heading for insolvency even faster,” as The State Journal, a weekly newspaper in Charleston, West Virginia, proclaimed; and “Social Security is slipping closer to insolvency,” as the Chicago Tribune told all of Chicagoland; and “Social Security fund cash (will be) gone in 2033,” according to The Christian Science Monitor; and that Social Security’s trust funds “will run dry in 2033,” as the New York Daily News shouted to New Yorkers.
Other outlets added to the journalistic drama. Bloomberg.com reported “Social Security Fund to Run Out in 2035,” noting “the giant retirement programs are straining the U.S. government’s finances.” Bloomberg TV’s Inside Track with Scarlet Fu was outside reality. A government report “confirmed what we all suspected. Social Security is a train wreck just waiting to happen,” Fu practically screamed. “The Social Security trust is now expected to run out of money in 2035, three years earlier than projected.” How’s that for accurate reporting?
Instead of noting Astrue’s warning, most reporters chose to feature the more alarmist messages of Social Security trustees Treasury Secretary Timothy Geithner and Charles Blahous. The Washington Post, no fan of Social Security in its present form, reported what Blahous had to say: “Never since the 1983 reforms have we come as close to the point of trust fund depletion as we are right now. Our window for dealing with [the shortfall] without substantially disruptive consequences is closing fairly rapidly.” Geither conveyed the same sense of urgency, telling the media that while Social Security and Medicare have the resources they need to fulfill their commitments for years to come, “these reports also reinforce that we must take steps to keep these programs whole for the future.”
The reason for Social Security’s dire predicament, WaPo and other news outlets reported, is that there will be more and more baby boomers collecting benefits with fewer workers in the future to support them. “Social Security’s bleak outlook is primarily driven by the ever-larger numbers of people in the baby boom generation entering retirement,” WaPo told readers. The paper did go into greater depth than other outlets, explaining that the trustees also pointed to two unforeseen economic factors—rising energy prices, which meant larger COLA increases, and lower-than-expected payroll taxes resulting from lower worker earnings. Most reporters, though, apparently didn’t make it to page 18 of the report, which clearly stated:
Changes in economic projections, due to new starting values and revised assumptions, are the most significant of several factors contributing to the increase in the (trust fund) deficit.Let the record show there were a few bright spots in the coverage. The NewsHour invited Nancy Altman, co-director of the advocacy group Social Security Works, who some in the press have called a defender of Social Security, to appear on the program along with Heritage Foundation research fellow David John. Ray Suarez’s questioning was evenhanded. One commenter remarked on the PBS site: “Nice to see some comprehensive explanation of the many parts of Social Security within a news item. For too long, this issue has been a buzz-topic based solely on people’s ignorance.”
The debate over Social Security is not going away. The media still have a chance for redemption.