With the war in Iran, delays at the nation’s airports, gas prices, and much more seeking the attention of lawmakers, it would be easy to miss another simmering budgetary emergency. The Congressional Budget Office just rang the alarm bell—again—on Social Security’s Old-Age and Survivors Insurance (OASI) program which is the main benefit for retirees. In testimony before the Senate Committee on the Budget, the agency’s chief of long-term analysis laid out how quickly the OASI trust fund is heading toward exhaustion and what kinds of across-the-board benefit cuts that would cause. It’s dire, it’s coming soon, but it’s also solvable. Congress just needs to make it a priority.

Social Security’s retirement program is mainly funded by a 12.4 percent tax on workers’ wages (up to a yearly limit), split between employees and employers, along with some taxes on benefits. That money goes into the Social Security trust fund. When benefit payments exceed the money coming in, the program draws down the trust fund. Once the trust fund runs out, the law only allows benefits to be paid from incoming taxes—meaning Social Security could only pay out what it collects each year.

Social Security is a big deal for both peoples’ income security and federal taxpayers. According to CBO, Social Security spending rises from 5.2 percent of GDP in 2026 to 6.0 percent by 2056. Much of the near-term increase reflects baby boomers retiring, but costs continue to climb over time as people live longer and collect benefits for more years. Revenues, by contrast, are largely flat. CBO projects dedicated tax income holding at about 4.5 percent of GDP over the next three decades. And as earnings grow faster at the top, more wages start to fall above the taxable cap, gradually weakening the program’s funding base. The result is a persistent gap between promised benefits and what payroll taxes can support.

It’s also important to understand what Social Security is—and isn’t. While it is often described as an earned benefit tied to workers’ payroll contributions, most beneficiaries receive more in lifetime benefits than they paid in Social Security taxes. Analyses of lifetime taxes and benefits show that, for the majority of households, benefits exceed contributions—sometimes by a wide margin—reflecting the program’s design as a social insurance system rather than a strict savings account.

How this gap between revenue and expenses shows up, however, depends on how you measure it. CBO’s “baseline,” which is meant to show how current law will play out financially, assumes benefits continue to be paid in full, even after the trust fund is exhausted. To make that possible, the baseline implicitly relies on transfers from general revenues, even though that is not current law. In effect, CBO assumes future Congresses will step in to shore up the program with tax dollars not intended for Social Security. This is an assumption, not a prediction.

While CBO makes similar assumptions in other areas, in this case it makes Social Security appear more stable than it actually is. By assuming full benefits indefinitely, the baseline shifts the cost of the shortfall onto the broader federal budget. This obscures the real trade-offs that will have to be made. Either benefits go down, Social Security taxes go up, or the program relies on higher borrowing and interest costs paid by taxpayers.

CBO’s testimony steps outside these baseline assumptions and asks what happens if Congress actually follows current law and lets benefits reflect only what dedicated revenues can pay. Let’s call this the “do nothing and let the trust fund run dry” plan.​

To match outlays to dedicated revenues over 2032–2036, CBO estimates that benefits would have to be cut by a cumulative $2.7 trillion. It simplifies this by assuming an across-the-board percentage reduction for all current and new beneficiaries once the trust fund hits zero. A 7 percent cut in 2032—just six years from now—is followed by cuts averaging 28 percent per year from 2033–2036. In other words, modest cuts are only a few years away, followed quickly by much deeper reductions.

CBO also notes that its analysis does not incorporate how benefit cuts could lower some households’ incomes enough to likely increase spending on other federal safety net programs. Lower Social Security checks would push some people to apply for Disability Insurance, while others would newly qualify for or receive larger benefits from Supplemental Security Income, SNAP (aka food stamps), and other means-tested programs. In other words, some of the “savings” from cutting Social Security would reappear elsewhere in the budget—and taxpayers would still be on the hook.

Congress has options. It can act now to put Social Security on a more sustainable path with gradual changes to benefits, revenues, or both, giving workers and retirees time to adjust. Or it can quietly rely on more borrowing that pushes costs onto future taxpayers. What it cannot honestly do is claim to be surprised if the trust fund clock runs out and the law forces sharp, sudden cuts.

To protect both beneficiaries and taxpayers, Congress needs to stop treating Social Security’s financial problems as someone else’s job and start legislating as if the 2032 exhaustion date is real—because it is. And it is right around the corner.