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Social Security could get $1 trillion boost

Social Security, which is set to become insolvent in roughly a decade, could get a $1 trillion boost due to the immigration surge, experts told Congress this week.

The House Ways and Means Subcommittee on Social Security met this week to discuss the program’s future financial situation, as the funding is likely to run out by 2035 if nothing changes. If this occurs, Social Security beneficiaries would see a 21 percent cut on benefits across the board.

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“The immigration surge, we project from 2021 to 2026, will result in about $1 trillion in additional revenue,” Dr. Phillip Swagel, director of the Congressional Budget Office (CBO), told officials during a hearing this week.

Social Security
A sign outside a U.S. Social Security Administration building in Burbank, California. An influx in immigration could add $1 trillion to Social Security’s funding.

VALERIE MACON/AFP via Getty Images

Democrats and Republicans have fought over the issue of Social Security for many years, with both sides accusing the other of attempting to enforce cuts to the program, which benefits seniors and those living with disabilities.

Some have suggested increasing taxes on the wealthy to make up for Social Security’s looming financial crisis, while others want to see smaller benefits today to save money in the long run. Meanwhile, some propose raising the retirement age to qualify or want a combination of the possible solutions.

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During Tuesday’s meeting, experts suggested immigration policy might actually be part of the solution.

While Republicans have long said immigration can reduce the amount of funding available in social safety net programs for Americans born in the U.S., budgetary experts indicated the opposite would be true.

Representative Linda Sánchez, a California Democrat, asked witnesses at the meeting if making legal immigration easier could help the Social Security trust fund.

“That would make a significant difference,” Stephen Goss, chief actuary of the Social Security Administration, said in response.

The Social Security program has been struggling as more baby boomers retire and become eligible for the monthly checks. At the same time, the declining birth rate in recent years make it so there aren’t enough current workers to pay into Social Security taxes that go toward seniors’ benefits.

Across 10 years, immigrants would add $1 trillion extra to the program, according to the CBO.

“There are cases where they have earnings reported,” Goss said. “They will likely not get any benefit credit, but payroll taxes still accrue on that point.”

Because undocumented immigrants cannot earn Social Security benefits, they wouldn’t add to the strain on the program, but they would still be required to pay into the program.

For 2013, for example, the Social Security Administration (SSA) found that undocumented immigrants paid $13 billion into Social Security taxes.

Despite these calculations, former president and current presidential candidate Donald Trump, the presumptive Republican nominee, has said that an influx of immigrants would be dire for Social Security.

“Unlike the Democrats, who are KILLING SOCIAL SECURITY AND MEDICARE by allowing the INVASION OF THE MIGRANTS,” Trump wrote on Truth Social. “I will NOT, under any circumstance, allow either of these two precious GEMS to be even touched under a Trump Administration.”

When asked if the SSA considers the impact of undocumented immigrants, Goss said: “Absolutely, we always have. The bottom line really is that immigration of any form is actually a positive in the realm we are now where the birth rates in the country are as low as they are.”

Americans have been pushing for Social Security reform after finding out that full benefits will run out in just a few years, but most do not want any cuts made to their checks, whether in the long or short term.

“The unfortunate long-term reality of Social Security is there are going to be too many tapping into benefits and not enough workers paying into the system in order to fund it,” Alex Beene, a financial literacy instructor at the University of Tennessee at Martin, told Newsweek.

“We’ve seen projects for years indicating this will happen within our lifetimes, but with a recent decline in birth rates in the United States, it’s becoming more apparent than ever before that the system won’t have the support in funding to continue to exist without government intervention.”

Beene called immigration the potential “wild card” in the deck of possible solutions.

“If the United States can gain more workers paying into Social Security, it could prevent the budgetary pitfall we’re all expecting at this point,” he said. “The question is, will that positive scenario be adequate enough to convince voters and legislators to support more pro-immigration measures.”

Chuck Czajka, a certified Social Security claiming strategist and founder of Macro Money Concepts, said raising the retirement age to 70 would be a good start.

“Ultimately, I believe Social Security is too big to fail,” Czajka told Newsweek. “If everyone gets a cut, that damage to the overall economy will be devastating. Therefore, I believe there will be reform. Increasing the full retirement age to age 70 would be a start. It is not that hard to fix. It just needs to be done.”