DI Trigger: Fixing what is broken in Social Security

post by Bruce Webb data by Dale Coberly

For those following along. Recent numbers from CBO and now from Social Security show that the DI (Disability Insurance) component of Social Security is officially broken, it failed the test for Short Term Actuarial Balance last year. And when combined with the OAS component brought Trust Fund depletion forward by four years from 2041 to 2037. But on inspection only about six months of that was the direct result of a revenue dip on the OAS (Old Age/Survivors) side, if the economy recovers along the lines projected by OMB OAS may well be fine long term. So we propose fixing DI, which is broken, and leaving OAS alone until it too trips a trigger for action. If it ever does.

DI Trigger: Google Spreadsheet

0.2% increase in 2010 plus another 0.1% in 2012 plus another 0.1% in 2045 sends DI through the 75 year window with a Trust Fund Ratio of 159. Assuming the employer/employee split this means the average laborer earning $12.50/hour would have to come up with a whopping 50 cents a week to ensure that his disability benefits were no longer at risk.