Social Security – Ryan ALM Blog

By: Russ Kamp, CEO, Ryan ALM, Inc.

Nearly eight years ago (2/28/18), I produced a blog post titled, “Let’s Just Cut Them Off!”, in which I took offense to an article trashing pension legislation then referred to as the “Butch Lewis Act” (BLA). The writer of the article, Rachel Greszler, The Heritage Foundation, stated that the BLA (as well as other potential solutions at that time) were nothing more than tax-payer bailouts. She estimated that these bailouts could amount to as much as $1 trillion. I stated at that time that “I don’t know where she has gotten this figure, but it is not close to reality.”

Ms. Greszler defined the potential recipients of these loans (now grants) as the entire universe of multi-employer plans totaling roughly 1,375 (at that time) with an unfunded liability of $500 billion. However, the Butch Lewis Act, and subsequently ARPA) was only designed for those plans that were designated as “Critical and Declining”. The total amount of underfunding for that cohort was roughly $70 billion. A far cry from the $1 trillion that she highlighted above.

So, where are we today? I’m happy to report that as of 12/19/25, the PBGC has approved Special Financial Assistance to 151 pension plans totaling $75.2 billion. These grants are ensuring that 1,873,112 American workers will receive the retirement benefits they were promised! Amazing!

In my original post, I wrote “given the author’s concern for the million or so union workers whose benefits may be trashed, she certainly doesn’t propose any solutions other than to say that a “bailout” is a horrible way to go. If these plans don’t receive assistance, they are likely to fail, placing a greater burden on the Pension Benefit Guaranty Corporation (PBGC), which is already financially troubled.” Fortunately, through the ARPA pension legislation, the PBGC’s multiemployer insurance fund is stronger today than it has been in decades.

I finished my post with the following thoughts: “Retirement benefits stimulate economic activity, and usually on the local level. The loss of retirement benefits will have a direct impact on these economies. Also, these benefits are taxed, which helps pay for a portion of the loans (now grants). Doing nothing is not an answer. I applaud the effort of those individuals who are driving the Butch Lewis Act. I encourage everyone to reach out to your legislatures to educate them on the BLA and to gain their support. There are millions of Americans who need your support. Thank you!”

I was thrilled to work with Ron Ryan and the BLA team headed by John Murphy and David Blitzstein. It remains one of the highlights of my 44-year career. Who knew when I began working with Ron and that team it would lead me to eventually join Ryan ALM, Inc. We continue to fight to protect and preserve DB pensions for the masses. There is a ton of work remaining to do. Securing those promises through cash flow matching (CFM) is an important first step. Let us help you accomplish that objective.

By: Russ Kamp, CEO, Ryan ALM, Inc.

With the demise of the defined benefit plan for many workers in the US private sector, Social Security benefit payments become ever more important for a greater percentage of the American retirees and those with disabilities. There have been several stories recently about Social Security and what the “average” recipient might receive in 2026 and worse, what their benefit reduction might be should the forecast of a “lockbox” shortfall in 2033 come to pass. We’ll get the official word on the 2026 COLA sometime in October, but early estimates are forecasting a 2.5% increase for next year. This potential increase barely matches headline CPI and it falls short of the current Core and Sticky inflation #s.

Social Security’s average monthly benefit among all retired workers is $2,006 in 2025, according to a recent AARP article. If the 2.5% increase turns out to be correct, checks will increase $50 / month. If my math is correct, that equates to an average monthly check of $2,056. The maximum Social Security benefit for a worker retiring at full retirement age is $4,018 in 2025. A 2.5% COLA will bring that figure to $4,118 in 2026. For those retiring at 62-years-old the maximum benefit in 2025 is $2,831, while the maximum benefit for a worker retiring at age 70 is $5,108 in 2025. Those numbers will be adjusted accordingly.

As we celebrate Social Security’s 90th anniversary, we need to understand that the on-going rhetoric about SS running out of money is a fallacy. There DOES NOT exist an “operational constraint on the government’s ability to meet all Social Security payments in a timely manner. It doesn’t matter what the numbers are in the Social Security Trust Fund account, because the trust fund is nothing more than record-keeping, as are all accounts at the Fed.” (Warren Mosler, “Seven Deadly Innocent Frauds of Economic Policy”) He continues, “When it comes time to make Social Security payments, all the government has to do is change numbers up in the beneficiary’s accounts, and then change numbers down in the trust fund accounts to keep track of what it did. If the trust fund number goes negative, so be it. That just reflects the numbers that are changed up as payments to beneficiaries are made.”

What we should fear is that Congress does not understand this concept and acts rashly to address the impending “crisis” that doesn’t exist. Recent estimates target a possible reduction in “benefits” at 23% to 24% in 2033. Try telling the nearly 70 million Americans, many relying on SS for most of their retirement assets, that they will see a dramatic reduction in a promised benefit that they themselves helped to fund. With 50% of retirees using SS for more than 50% of their retirement income and another 25% in which SS makes up 90% or more of their retirement income, the economic impact from these potential benefit cuts would be cruel and absolutely unnecessary.

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