As Congress and the Trump Administration begin releasing their proposed budgets for FY18, Americans will be eager to know how their elected representatives fund important programs that they deserve and have paid for with their tax dollars. They will also want to know whether their elected representatives use the budget as an excuse to go after Social Security. Social Security has no place in the general budget of the United States. The monies that pay Social Security benefits and related administrative costs do not come from government coffers, but from its own dedicated income, held in trust for its contributors and beneficiaries. The vital program is entirely self-financing, with no borrowing authority. Consequently, it does not add a single penny to the deficit.
That Social Security is not a part of the United States budget is not a matter of debate. It is the law. Section 13301 of Public. Law .101-508 unambiguously states:
(a) EXCLUSION OF SOCIAL SECURITY FROM ALL BUDGETS. — Notwithstanding any other provision of law, the receipts and disbursements of the Federal Old-Age and Survivors Insurance Trust Fund and the Federal Disability Insurance Trust Fund [I.e., Social Security] shall not be counted as new budget authority, outlays, receipts, or deficit or surplus for purposes of—
(1) the budget of the United States Government as submitted by the President,
(2) the congressional budget, or
(3) the Balanced Budget and Emergency Deficit Control Act of 1985.
There is nothing surprising about this law. Private employers that sponsor pension plans are legally required to keep plan income and assets in trust, segregated from the company’s general operating fund. Under the same principle and for the same reason, the law requires that Social Security’s income and assets be held in trust, segregated from the general operating fund of its plan sponsor, the federal government.
Outrageously, politicians routinely ignore the clear legal prohibition and lump Social Security’s benefits together with general federal expenditures, and its premiums and investment income with receipts from the income tax and other federal taxes. To its great credit, the People’s Budget follows the law and does not include Social Security in its proposed federal income and outgo.
While the People’s Budget complies with Pub. L. 101-508, it includes policy recommendations to expand and strengthen Social Security, but makes clear that those should be considered separately from the Congressional budget process:
With the nation facing a looming retirement income crisis, expanding Social Security will help ensure that every American can retire with security and dignity. Right now, Social Security benefits average just around $16,080 a year for retired workers. The People’s Budget supports increasing Social Security’s modest benefits separate and apart from budget discussions, because Social Security does not add a penny to the deficit and, by law, is not to be counted as part of the federal budget.
Recognizing Social Security for the solution that it is while making clear that its funds are dedicated exclusively to the sole purpose of funding earned benefits (and the associated administrative costs) should not be a novel position. The Congressional Progressive Caucus is to be applauded for seeing this when other politicians don’t. The CPC deserves our gratitude. And the People’s Budget deserves our support.
The other budgets, which appear to commingle Social Security’s dedicated, segregated revenue with general taxes deserves our condemnation, explain why so many Americans believe that their Social Security contributions have been stolen by their government, diverted to some unauthorized purpose.
Year after year, every proposed budget, except for the CPC’s, reinforces the harmful myth that the people’s pension monies – the Social Security trust funds — are not being properly managed. Every other budget treats Social Security’s dedicated funds as if they were commingled with other federal revenues in a so-called unified budget — despite the clear requirements of the law to do the contrary. Is it any surprise that the American people doubt that their Social Security premiums are being handled properly, as they should be?
Politicians who support Social Security and want their constituents to know that they are taking their fiduciary responsibilities toward this vital program seriously should support the People’s Budget for this reason alone. During the campaign, Donald Trump repeatedly pledged to protect Social Security. If his budget does not make clear that Social Security is separate and apart from other government income and outgo, he will have breached his promise.
It is well past time that the Republican establishment and Donald Trump recognize what their voters and indeed the overwhelming majority of Americans understand: Social Security has no place in budget discussions. It is also well past time that, separate and apart from the budget, Social Security is expanded, and not cut. Politicians should follow this clear will of the people. After all, they work for us.
Link to original article from The Huffington Post