The total annual cost of Social Security is projected to surpass total income this year for the first time since 1982, the program's board of trustees said in its annual report.
The trustees also found Medicare's hospital insurance fund is on pace to run out in 2026. And 2017's Tax Cuts and Jobs Act is making the problem worse by cutting Medicare and Social Security taxes further reducing available revenues. Financed with payroll taxes collected from workers and employers, Social Security and Medicare account for about 40 percent of government spending, excluding interest on the federal debt.
However, as now projected, it is highly unlikely that economic growth absent larger reforms could solve the programs' huge budget quagmire.
Treasury Secretary Steven Mnuchin said in a statement that there's time to fix the problems.
Trustees said the trust fund for hospital expenses is not sufficiently financed over the next decade. That's what he would say, given that fiscally irresponsible Republican policies, those ballyhooed tax cuts included, will add $1.6 trillion to the federal deficit over the next 10 years, according to the Congressional Budget Office.More news: ‘Sure looks like Zuckerberg lied to Congress’: Democrat on Facebook report
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President Trump has said he won't cut Social Security or Medicare, and his administration says that a strong economy will bolster both programs. The way to do that is to legislate modest reforms to the entitlement programs along with higher taxes (including Social Security payroll taxes) for those most able to afford them.
In 1960, there were about five workers for every Social Security beneficiary.
Medicare's problems are widely seen as more hard to solve. At the end of 2017, the program had about 62 million beneficiaries.
The annual Social Security cost of living adjustment for 2019 could top 3%, according to a just-released estimate by The Senior Citizens League, boosting the average Social Security benefit of $1,300 by about $39 per month.
Two other Medicare funds - Part B, which covers doctor and outpatient visits and Part D, which covers prescription drugs - are reset each year based on projected costs.
Information for this article was contributed by Robert Pear of The New York Times, and by Ricardo Alonso-Zaldivar and Andrew Taylor of The Associated Press.