The latest report issued by Trustees of the Social Security Trust Funds has come and gone, leaving a trail of good news in its wake. This is great for politicians running for office, and less so for the guy on the street.

Given that voters are the ones who will suffer the consequences of procrastination, it is pretty important that everyone understands the conflicting narratives that come with the release of the latest forecast because it will last through the coming election and into next year.

Social Security has two legally distinct trust funds serving two legally distinct programs: Old-Age/Survivors and Disability. While current law does not provide for the consolidation of these programs, the Trustees provide information for each report, and in combined form. So, there are actually three different versions of the report, giving pundits a lot of options to present. 

Understandably, experts pick and choose the information that fits their narrative without disclosing all the assumptions factored into their opinion. As a result, one person will hear at times that the program will inflict across the board cuts of 21 percent in 2033 while in other places experts will say that no matter what you will get 83 percent of your scheduled benefits starting in 2035.

Given the importance of the program to average Americans, it is important for voters to ask why is there such a large gap in the numbers?

The exhaustion date of 2033 refers to the Old-Age Survivors program, which serves about 80 percent of those collecting benefits from the overall system. When pundits cite the 2035 date, it incorporates a prediction that Congress will take resources away from the Disability program to cover the gaps in the Old-Age/Survivors program.

When I write, my columns stick to current law. As a libertarian, I tend to doubt the overall effectiveness of politics. In this case, the premise that Social Security checks continue in full throughout 2033 and into 2035 is based on the idea that lawmakers will raid the Disability fund to subsidize the retirees.

In my mind, that possibility has zero chance of materializing because Congress will have to convince Disability beneficiaries to accept 75 years of partial benefits so that seniors can collect full checks for an extra year. These trade-offs have never been this large, and now seem to the untrained eye entirely implausible.  

Of course, if this change will be easy for Congress to resolve in the 2030s, just show me and do it now.

The other mistake that analysts tend to make is blind faith in the accuracy of these reports. Every conclusion in the Trustees Report is more of a coin-flip and less of a certainty. As you think about the importance of this program in your life and that of your loved ones, realize that the likelihood that program “will pay” scheduled benefits in 2033 is about 50 percent.

For the average voter who turns 80 years old today, it is a coin flip that they will be alive in 2033, and a coin flip that they will have a lifeline. Believe it or not, it is about a coin flip that this person will collect 90 percent of their income from these checks.

No one is saying that Social Security will go away entirely, but it is irresponsible to suggest that you will receive an across-the-board cut of 17 percent to 21 percent at some specific point in time. The key fact to consider is no one has any idea of how the program would distribute a system-wide reduction of benefits to the individual beneficiary.  

Moreover, these figures represent the overall reduction in the first year, where the second year of retirement is still up in the air. The Trustees assume that the economy will continue to grow at a 2.4 percent rate in 2035, whether seniors get full checks or partial checks.    

In this environment, it is fairly irresponsible to suggest that you will get 83 percent of your benefits in 2035. That assessment means that the economy will continue to churn out jobs and pay increases, whether the program is solvent or not, and whether Congress acts or not.

Politics is the art of making the act of idle neglect take on the image of grueling hard work. The latest report serves politicians of the day because the numbers provide ammo to all sides of the debate, virtually ensuring at least another year of inaction.

When people talk about the measure of good news, they mean that Congress has another year to think about the program’s financial stability. That is great for Washington. It is terrible for everyone else.

Brenton Smith (think@heartland.org) is a policy advisor with The Heartland Institute.

Image: 401K 2012 via Flickr