From the U.S. Government Accountability Office, www.gao.gov Transcript for: How Can We Fix Social Security? Description: An overview of Social Security's financial challenges and options to address them. Related GAO Work: GAO-16-75SP: Social Security's Future: Answers to Key Questions Released: October 2015 [First Screen] GAO logo [Second Screen] This video was released on October 27, 2015. The Bipartisan Budget Act of 2015 subsequently made a number of changes to Social Security's programs, including moving the projected date of Disability Insurance trust fund depletion from 2016 to 2022. [Background Music] [Third Screen] GAO logo Social Security has been the bedrock of retirement security, paying cash benefits to tens of millions of older Americans, people with disabilities, and their families. It has also helped to reduce poverty among recipients. But action is needed soon to address the program’s financial challenges. [IMAGE: Dollars on screen, with photographs of a range of individuals. Sketch of a bar chart showing poverty going down. Photograph of Capitol dome, and then dollars covering screen.] Social Security benefits are funded primarily through taxes current workers and employers pay into the system, which go into two trust funds - one for retirement and one for disability benefits. Social Security is a social insurance program in which society as a whole insures its members against risks they all face. Some people will receive benefits that exceed their contributions, and others will not, depending on how long they live and other factors. [IMAGE: Social Security card with the term ‘Social Security Benefits’ on it. Photograph of workers with a check over them that says ‘Wages.’ Dollars flow from check into a Social Security card labeled ‘Benefits’ and then into two other Social Security cards labeled ‘Retirement’ and ‘Disability.’ Photographs of a range of individuals. Words on screen ‘So What’s The Problem?’] The population of older Americans is growing, as the baby boom generation retires and life expectancy increases. [IMAGE: Line chart showing the older American population as a percentage of the total population age 65 and over. Line rises over time between about 1990 and 2060.] These, along with other factors, are contributing to a widening gap between how much Social Security takes in and how much it spends. [IMAGE: Dollars on screen.] In 2010, costs for Social Security began to exceed tax revenues, and this trend is forecast into the foreseeable future. [IMAGE: Bar chart showing the surplus revenues in billions from about 1980 to 2015. Line falls into negative amounts at 2010. Words on screen ‘How Bad Is It?’] The disability program is projected to be unable to pay full benefits on time by the fourth quarter of 2016. After that, revenues would be sufficient to pay 81 percent of benefits. [IMAGE: Dollar on screen. Words on screen ‘100% benefits paid for’ and ‘2016 Q2’ and then ‘81% benefits paid for’ and ‘2016 Q4.’ ] By 2035, the same fate is projected to befall the retirement program. If nothing is done, revenues would be sufficient to pay 77 percent of benefits. [IMAGE: Dollar on screen. Words on screen ‘2035’ and ‘Retirement Program,’ ‘if nothing is done,’ and 77% benefits paid for.’ Words on screen ‘So What Do We Do?’] A variety of options have been proposed by policymakers, researchers and other experts to put Social Security back on track. [IMAGE: Papers on screen. Photographs of Capitol Dome, a brick building, and an office tower.] In the short-term term, Congress could direct more payroll taxes to the disability program….or allow it to borrow from the retirement program. This would allow more time to develop a long-term solution, although key decisions about program financing would still have to be made. The longer we wait, the more severe the changes will need to be. [IMAGE: Photograph of Capitol Dome, with dollars flowing into two Social Security cards labeled ‘Retirement’ and ‘Disability.’ Then dollars flowing from ‘Retirement’ card to ‘Disability’ card. Image of calendar with months going by. Words on screen ‘The longer we wait’ and then a caution symbol with the word ‘Changes’ over it.] Other suggested options to bolster the retirement and disability programs include: Changing benefits and eligibility, changing how benefits increase over time, and increasing taxes for Social Security. [IMAGE: Two social security cards labeled ‘Retirement’ and ‘Disability’ moving on screen. Image: Dollar bill symbol in circle. Words on screen match narration.] For the disability program, experts have suggested a variety of other options that include: Changing the eligibility criteria, improving how the program is administered, and helping workers with disabilities stay employed. [IMAGE: Dollar bill symbol in circle. Words on screen match narration.] If action is taken soon, changes can be phased in over time … lessening the impact on recipients and allowing more time for coming generations to plan for their financial futures. Delaying action will require more difficult decisions moving forward. [IMAGE: Word on screen ‘Action Soon’ and clock with hands quickly turning. Image of calendar with months going by. Words on screen ‘Delaying action’ and ‘Difficult decisions’ with an arrow.] [IMAGE: GAO logo] GAO has issued a broad framework for policymakers to consider when evaluating these and other options as part of a comprehensive approach to strengthening the Social Security system. [IMAGE: GAO logo. Dollar bill symbol in circle. Words on screen ‘Strengthening Social Security System.’] For more information, see GAO’s guide to Social Security’s future at www.gao.gov/socialsecurity. [Final Screen] Image of guide to 'Social Security’s Future www.gao.gov/socialsecurity GAO-16-75SP'