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Delaying Social Security reform raises risks for bond markets and the economy, research finds
Researchers say a $600 billion annual shortfall could force more borrowing and lift mortgage, auto and business loan rates.
- On June 26, 2026, Mercatus Center researchers Veronique de Rugy and Jason Fichtner warned that delaying Social Security reform could force increased government borrowing, potentially triggering a fiscal crisis.
- The Old-Age Survivors Insurance trust fund faces depletion in the fourth quarter of 2032, with annual shortfalls projected to grow from roughly $600 billion in 2033 to about $700 billion by 2036.
- Marc Goldwein of the Committee for a Responsible Federal Budget notes that abandoning the 90-year promise of a self-financed program could open the floodgate to unsustainable borrowing and fiscal instability.
- Higher government borrowing could increase interest rates across the economy, with 30-year fixed mortgage rates potentially jumping from 6.3% to nearly 9% as investors reassess fiscal risks.
- Bond markets may react as soon as 12 months before depletion, Fichtner told CNBC, forcing Congress to address solvency issues to avoid sudden shifts in holdings and duration risk.
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Omaha World-Herald+17 Reposted by 17 other sources
The gig economy should help save Social Security
The Social Security trust fund will run out of money by late 2032, according to an annual report last month. The specific date is new, but the overall trend is not: Social Security’s long-run imbalance was first projected in 1985.…
·Omaha, United States
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Delaying Social Security reform raises risks for bond markets and the economy, research finds
Social Security's trust fund that helps pay retirement benefits is projected to run out in late 2032. New research finds that may pose serious economic risks.
·Englewood Cliffs, United States
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Total News Sources21
Leaning Left4Leaning Right1Center16Last UpdatedBias Distribution76% Center
Bias Distribution
- 76% of the sources are Center
76% Center
L 19%
C 76%
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