A report by the nonpartisan policy institute, Center for American Progress, noted that on February 16, “the last of the nation’s millionaires stopped contributing to Social Security for the entire year.” The report highlighted how the nation’s earnings inequality is taking a growing toll on Social Security particularly considering the growing role social security will continue to play as more and more baby boomers retire, and the population lives longer.
The report also quantified the amount of contributions to the Social Security Trust Funds the nation has foregone because the Social Security Payroll tax only covers 83 percent of earnings versus 90 percent. Researchers estimated, had policy makers implemented the adjustment in 1983, the Social Security Trust Funds would have added an additional $1.3 trillion dollars to its coffers. Also, according to report estimates, had American workers’ salaries grown commensurate with their productivity since 1983, the Trust Funds would have accrued an additional $559.7 billion dollars.
Today, almost three in five seniors and nearly eight in ten disabled workers rely on Social Security benefits as the primary source of income for themselves and their families.
The Social Security trust funds include the Old-Age and Survivors Insurance (OASI) and Disability Insurance (DI) Trust Funds. The funds are managed by the Department of the Treasury.