7 myths that undermine Social Security

Unfortunately, these myths are very powerful and have taken hold in the popular consciousness. Many Americans seem to believe them. Our social media feeds are full of comments like, “Politicians should pay back the money they stole from Social Security!…Stop illegal immigrants from collecting benefits!…Social Security is going broke!”

These myths are far from benign. They take their place beside other falsehoods and conspiracy theories in today’s America — from antivax to Q-Anon — that can do real-world harm. The surest way to undercut public support for Social Security is to convince working people that they’re somehow being cheated — by politicians, undocumented workers, or the system itself.

As president of a national seniors’ advocacy group, I spend a fair amount of time debunking these falsehoods. Here are seven of the most insidious Social Security myths and why they simply aren’t true.

Myth 1: Social Security is ‘going broke’

The media response to the latest Social Security Trustees report is a perfect example of the potency of this myth. Headlines trumpeted that “Social Security is running out of money.” In truth, the reserves in the Social Security trust fund are projected to become depleted in 2035 if Congress takes no action to prevent it, in which case the program still could pay 83% of scheduled benefits.

Social Security itself is not ‘going broke’ or ‘bankrupt.’ The program receives most of its revenue from workers’ payroll contributions — and will continue to do so in 2035 and beyond. The only way Social Security would ‘go broke’ is if we had 100% unemployment and no one was paying into the system. Of course, that has never happened in the program’s 89-year history — and never will.

Myth 2: Social Security contributes to the federal debt.

Politicians love to conflate Social Security with the federal debt, insisting that the program must be cut to reduce red ink. Some even claim that Social Security is “the number one driver” of debt. The opposite is true. Social Security is self-financed by workers’ payroll contributions — not through general federal revenue.

The program is not legally allowed to borrow money. In fact, as the holder of specialTreasury notes in the Social Security trust fund, the program is one of the nation’s biggest creditors.

Actually, the No. 1 driver of the debt is “tax expenditures,” such as giveaways to the wealthy and giant corporations like the Trump/GOP tax cuts of 2017, which supposedly ‘debt-conscious’ Republicans now want to make permanent. A recent Congressional Budget Office report indicates that extending those tax cuts would explode the debt by $4.6 trillion over the next 10 years.

Myth 3: Politicians are stealing from Social Security

This is an old myth that says presidents and members of Congress have misused or “stolen” Social Security funds for other purposes. It stems from a misunderstanding (or distortion) of how Social Security is financed. Any surplus revenue from workers’ payroll contributions goes into a trust fund that is invested in special Treasury notes.

Just as you wouldn’t stuff nearly $3 trillion under your mattress, the Social Security program

invests in bonds backed by the full faith and credit of the United States. As with other bonds, the government can use the proceeds for other purposes (an F-35 jet fighter, Meals on Wheels, federal cancer research, etc.) before the bonds mature — but must repay them with interest on a fixed timeline.

Bonds purchased by private citizens, companies, or other governments work basically the same way. But no one accuses lawmakers of “stealing” these funds, and they shouldn’t with Social Security, either.

Myth 4: Undocumented workers are collecting Social Security

Often this myth is perpetuated as part of a xenophobic political agenda. None other than candidate Donald Trump used this lie in a 2016 campaign ad, claiming that “illegal immigrants” were “collecting Social Security.” Unfortunately, many people believe it and say that the way to strengthen Social Security is to stop undocumented workers from receiving benefits.

While it’s true that some of these workers using false Social Security numbers do pay into the system, they are not eligible to collect benefits (unless they become legal residents or U.S. citizens). Ironically, they help to fund Social Security without getting anything out of it — the opposite of what the myth-perpetuators claim.

Myth 5: Members of Congress don’t pay Social Security taxes

This is a tricky one. Members of Congress were exempt from paying Social Security taxes (and couldn’t collect benefits) before 1983. The Social Security reforms of that year changed the law. All Members of Congress were required to participate in Social Security as of Jan. 1, 1984, regardless of when they first entered Congress.

In turn, they became eligible to receive benefits under the same rules as everyone else. The myth that members of Congress still don’t contribute to Social Security is an attempt to falsely accuse lawmakers of not paying their fair share.

Myth 6: Social Security is a Ponzi scheme

Here’s a favorite of demagogues: Social Security is a Ponzi scheme. They insist that because payroll taxes from the current generation of workers help to fund benefits for current retirees, the whole system is a ‘scheme’ of perpetual borrowing, with no real assets. Some Republicans, including Wisconsin Sen. Ron Johnson, former presidential candidate Rick Perry, and (surprise) Donald Trump, have deployed this myth to discredit the very existence of Social Security.

Unlike the investment scam operated by swindler Charles Ponzi in the early 20th century, Social Security maintains a trust fund to pay future benefits. That trust fund is invested in rock solid, interest-bearing government bonds. While it’s true that the trust fund faces a shortfall in the 2030s, Congress could cure this problem by adjusting thepayroll wage cap, which currently favors wealthy earners.

Comparing a social insurance program that has worked for nearly nine decades and never missed a payment to a criminal enterprise is, as one expert put it, simply “outrageous.”

Myth 7: Social Security is unfair to younger workers

This one is related to Myth 6. Despite the fact that Social Security has been a successful intergenerational compact for all these years, conservatives claim that the system is a rip-off for younger workers.

They disingenuously argue that younger adults cannot afford to contribute to Social Security, and sow doubts that the program will still be there when today’s workers retire. This is part of a decadeslong strategy to divide the generations on the issue of Social Security so that the program can be cut or privatized.

In reality, the payroll taxes that younger workers contribute toward the system are earning retirement benefits they will sorely need, given the lack of pensions and the difficulty in saving for old age fueled by income inequality.

The average millennial, for instance, is on track to receive some $1 million in Social Security and Medicare retirement benefits. Younger workers also are earning other valuable benefits that they may need before retirement. The average 27-year-old with a spouse and two children already has the equivalent of nearly $2 million in life and disability insurance from Social Security. That’s a pretty good deal by any standard.

Max Richtman is president and chief executive of the nonprofit National Committee to Preserve Social Security and Medicare. He is former staff director of the U.S. Senate Special Committee on Aging.