Status of Social Security and Medicare: Summary of the 2005 Annual Reports

Following President Bush's re-election in November 2004, the issue of whether and how to modify Social Security  emerged as a major point of discussion among policymakers, the media, and interested groups. After an unsuccessful effort to sway public opinion and persuade members of Congress to enact fundamental reforms, including personal accounts, Social Security reform now appears to be off the table until at least the next presidential election in 2008. Yet  the underlying problems facing Social Security have not changed: in 2017, Social Security will begin to pay out more than it collects, which will require the Social Security Administration to begin, for the first time, to draw on the Social Security Trust Fund. In 2041, the Trust Fund is projected to be exhausted, which will require a combination of severe benefit reductions and revenue increases.

Approximately one-fourth of all state and local government employees do not participate in Social Security. Police officers, firefighters, and school teachers are among the groups of public employees most likely to not participate; general employees of state and local governments in several states also do not participate. NASRA's sole position on Social Security to date is a resolution opposing mandatory coverage for state and local government employees.