With rising consumer prices on the top of voters' minds just days from the November midterm elections, the White House is arguing that inflation is actually a good thing for America's senior citizens.
On Tuesday evening, the White House said "seniors are getting the biggest increase in their Social Security checks in 10 years through President Biden's leadership." The post from President Joe Biden takes credit for a boost to Social Security payments, around 8.7 percent for 2023, that occurred because Social Security payments must adjust to the approximate rate of inflation each year by law.
The White House's claim was subsequently fact checked by Twitter—and deleted—but follows a recent pattern by both the president and his staff in which they assert Biden deserves credit for rising Social Security payments. Biden does not, nor does anyone in the White House, have any control over how much the program pays out.
A White House official told the Free Beacon that their tweet was deleted because "the point was incomplete." The official also referred to an Oct. 12 statement from press secretary Karine Jean-Pierre that said "seniors and other Americans on Social Security [sic] are will learn precisely how much their monthly checks will increase."
"We will put more money in their pockets," the statement said.
Not only does the White House have no control over the adjustments to Social Security payments, but more money leaving the Social Security Trust Fund means it will go bankrupt sooner, economists say.
"This isn’t a generous gift from the president, it’s an automatic reimbursement for a lot of the pain retirees have been feeling for the past year," Manhattan Institute economist Brian Riedl told the Washington Free Beacon. "A generous cost-of-living adjustment could certainly move up the Social Security Trust Fund’s exhaustion day by a few years."
Economists across the political spectrum agree that several of Biden’s spending programs, such as the nearly $2 trillion American Rescue Plan, contributed to today’s historically high inflation. Economists also fear his latest proposal, canceling up to $20,000 of student loans for millions, could drive consumer prices even higher.
Prior to the new cost-of-living adjustment, the Social Security Trust Fund was estimated to go bankrupt in 2034. At that point, Social Security payments would stop unless Congress appropriated new funding.
Social Security currently operates at a loss. Last year, the program paid out $56 billion more than it took in through taxes.
"If policymakers continue to do nothing to shore up Social Security, all beneficiaries will face an immediate 20 percent cut at the time of insolvency," Committee for a Responsible Federal Budget president Maya MacGuineas said in a statement. "The longer we wait to secure [Social Security], the larger and sharper the adjustments will need to be."
Roughly 47 million Americans rely on Social Security for their retirement, a number that is expected to rise in the coming years as more Baby Boomers drop out of the workforce. When the Social Security Trust Fund runs out of money in 2034, the program will only be receiving enough tax revenue to pay 77 percent of benefits.
A June report from the Social Security administration, released before the new cost-of-living adjustments, concluded that both Social Security and Medicare "face long-term financing shortfalls under currently scheduled benefits and financing."
"We’ve been kicking this can down the road, these inflation adjustments just mean that lawmakers will be having to face this issue sooner than before," Riedl said. "Ultimately I think seniors would prefer 2 percent inflation with a 2 percent Social Security cost of living adjustment than 8 percent inflation with an 8 percent cost of living adjustment."
Published under: Biden Administration , Inflation , Social Security