The President’s new budget proposes to use the chained Consumer Price Index (CPI) for computing cost-of-living adjustments in Social Security and certain other federal benefits, as well as for indexing key parameters of the tax code. The effect of this proposal on Social Security retirement benefits would vary by a person’s age and benefit level and would differ for current and future beneficiaries, but most future beneficiaries would experience a benefit reduction averaging about 2 percent over the course of their retirement. For most current beneficiaries and for low-income beneficiaries, the average reduction would be smaller. Read more
Social Security Disability Insurance is Vital to Workers With Severe Impairments
Program’s Growth Largely Due to Demographic Factors; Financing Should be Addressed as Part of Overall Solvency
The Social Security Disability Insurance (DI) program provides modest but vital benefits to workers who become unable to perform substantial work on account of a serious medical impairment. Although some critics charge that spending for the program is “out of control,” the bulk of the rise in federal disability rolls stems from demographic factors: the aging of the U.S. population, the growth in women’s employment, and Social Security’s rising retirement age.
- Testimony: Pending Insolvency of Disability Insurance Expected and Should Be Addressed
- SSI and Children with Disabilities: Just the Facts
Social Security benefits play a vital role in reducing poverty. Without Social Security, 21.4 million more Americans would be poor, according to the latest available Census data (for 2011). Although most of those whom Social Security keeps out of poverty are elderly, nearly a third are under age 65, including 1.1 million children. Depending on their design, reductions in Social Security benefits could significantly increase poverty, particularly among the elderly.
Social Security provides monthly benefits to more than 50 million retired workers and workers with disabilities, their dependents, and their survivors. Though Social Security is best known as a retirement program, one-fifth of the program's beneficiaries are non-elderly adults (under age 62) or children who receive survivors' benefits or disability insurance benefits.
- Top Ten Facts on Social Security
The Center examines the effects of Social Security on poverty (including poverty among children) and on particular demographic groups. We also analyze Social Security reform proposals to determine their likely impact on the program’s long-term solvency and its effectiveness in reducing poverty and hardship.
April 23, 2013
Updated April 15, 2013
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