The Social Security Administration is changing its culture slowly but surely in an effort to restore trust in the federal program that so many people rely on to finance their retirement years, according to Social Security Administration Commissioner Martin O’Malley.
That trust is essential to saving the system for the future, O’Malley told the attendees of a webinar Tuesday co-sponsored by the Urban Institute, a nonpartisan research organization that provides data and evidence to advance upward mobility and equity. The other sponsor was the AARP.
The commissioner acknowledged that the program is facing massive customer service challenges, but he said the system is salvageable and is not running out of money. The Urban Institute recently issued a report, “Social Security Customer Service Challenges: Causes, Impacts, and Solutions,” on which the discussion was based.
“The system has been pushed into a customer service crisis,” O’Malley said. “Because of budget cuts imposed by [succeeding] Congresses, staffing has been reduced to a 50-year low.” There was an untenable backlog in processing applications for disability benefits and long wait times when someone tried to call or visit a Social Security office.
“But we are now being transparent about the challenges” and making headway in achieving changes, he added, all of which should restore trust in the program, which serves 70 million Americans.
“Trust is as necessary to a democracy as air is to life,” and programs like Social Security also require the trust of the people depending on it in order to operate successfully, he said.
Wait times for those calling Social Security or visiting an office have been reduced, and the program has achieved 18 weeks in a row in which more disability applications have been processed than have been filed. Because of staffing cuts, the Social Security Administration website has been improved, although more technology improvements are needed, O’Malley admitted.
The administration is working on issues such as the built-in bias that is sometimes programed into technology, however, which affects the processing of applications: For instance, technology sometimes uses ZIP Codes to determine the economic well-being of beneficiaries, he said. The administration has also been battling the negative idea that it is going to run out of money in the near future.
“The program cannot run out of money because it is a pay-as-you-go system,” O’Malley said. But Congress set up a trust fund that can be used for some benefit payments, and those payments eventually will be reduced if the trust fund is not rebuilt.
“This is a solvable problem,” he added. “Just make wealthy people pay Social Security taxes on more of their incomes.” Currently, Social Security taxes are paid on the first $168,000 of income. The current levels of income inequality is also influencing that tax disparity, because there is more income on which the Social Security tax is not imposed.