Back in the day you had 100 ditch-diggers for every retiree on social security, so the system worked. Now you’ve got one ditch-digger for every 10 retirees, so the math doesn’t work because that’s not enough wage income for the program to feed off of. But that one ditch-digger now easily does the work of 1,000 ditch-diggers in the old days because he’s got advanced equipment to dig with. In other words, his productivity is much higher.
Tax capital to pay for social security. This is the very obvious fix that nobody wants to talk about because the funders of our political parties won’t tolerate it. But fixing social security to wage income was always going to be a loser after 1971 when wages began falling relative to productivity. Now as the economy grows, wages grow only modestly, and capital grows quickly. Pin social security to capital and we don’t have this issue.
For a while, as we got more productive, it meant an easier life for our old and indigent. But since the early 1970s, all of the extra gains from productivity have been going to shareholders instead of wage-earners, and that’s social security’s problem.
For people that are interested in learning a lot about this, the OASDI Trustee's Report has a pile of information regarding specifically what the issues are and what they're projected to be: https://www.ssa.gov/OACT/TR/2026/tr2026.pdf
From Page 71:
>The effect of the demographic shift on the OASDI cost rates is clear when
one considers the projected number of OASDI beneficiaries per 100 covered
workers under the three alternatives. Compared to the 2025 level of 38 beneficiaries per 100 covered workers, this ratio is projected to rise to 54 by 2085
under the intermediate assumptions, because the growth in beneficiaries
greatly exceeds the growth in workers. This projected ratio under the intermediate assumptions remains relatively stable thereafter, reaching 53 by
2100.
You can rough back of the napkin some of this yourself - the median wage is ~65k, that translates to a total of ~8k of collected SS tax (employer + employee). The median social security benefit is just over 1,900/mo or about 23k/yr. That means with absolutely zero administrative drag you need 2.8 median workers to sustain one median retiree.
Flipped to the context above, that would be a ratio of 35 beneficiaries to ever 100 workers. So we're already beyond that level, we're expected to see retirees hit over 50 per 100 workers, which would mean we'd be collecting (in present dollars) less than 70 cents for every dollar we're paying out of the system.
Demographics are the problem, but congress knew this was a problem decades ago, and rather than making small incremental shifts to build a larger trust fund they sat there doing nothing, so now it's a real big problem.
I mean, yeah immigration is absolutely a good thing for maintaining labor force demographics, but this mountain is way too tall to climb on immigrants backs alone - taxes on everyone are gonna have to go up. The annual structural deficit here is gonna hit a trillion and a half in present dollars within 20 years.
If you're going to correct someone, at least get it right.
>The original Social Security worker-to-beneficiary ratio was exceptionally high when monthly payments began in 1940, standing at 159.4 workers per beneficiary
I'm on SS, though I still work at 77, but I don't think younger working people -- who are struggling -- should pay more in SS taxes to solve this problem, especially for those receiving benefits now. Congress needs to find another solution.
This issue has been in every SS Trust Fund Report since at least 2010. Obama tried to do something about it, but was even bashed by Democrats.
We really should be means testing though. No reason someone making $200k off their retirement accounts should be getting a check for another $40k. If your concern is avoiding elder poverty, there are better ways to do it.
It gets phased in taxed. Below $32k it doesn’t get taxes at all, between 32 and 44k it gets taxed at 50% of the income tax rate, and above 44k it’s 85% of the income tax rate.
Yes it would add a little complexity, but not much. You just look at last year’s tax return and automatically adjust it. A computer can do that easily. It would save a lot of money.
The reason means testing adds a lot of complexity for welfare is that welfare means testing is based off of wealth, not income. You report your income (and attest that it is correct) every year to the government. You do not report your wealth, and also wealth can be hard to judge since some assets are illiquid. If you are paid in cash, not goods, then your income is easy to judge.
It was never intended to be another welfare program. Earned Rights vs. Handout, Political Protection from it being a "right," all that. The whole premise of it.
Why would I have a portfolio, at least public, that would disqualify me from getting pennies on the dollar I put in through Social Security anyway? These are smart people. Why not spend it all as you age or throughout your life or at least "spend" it all?
Many ways to work around this and it still doesn't plug the budget gap, which is the same bottom-line issue of raising the cap even if we just assume that smart people are going to play dumb to play along.
I think today's younger workers have serious concerns about whether SS will be there for them. And I don't blame them.
Since, when you cut through all the BS, younger folks are essentially paying my and your SS -- just like I paid for older generations 40+ years ago -- Congress needs to find another solution than raising their taxes. YMMV.
I think that means testing and slowly raising the retirement age is the answer. If you have $200k of income or some high number you don't need Social Security, regardless of whether you paid in or not. Is it a social safety net program or is it a program where you just get back what you put in? If it was made to help people not starve in retirement than how can you argue against means testing? The question of whether you should be forced to pay into it is another thing entirely.
I’m fine with means testing, as long as if one’s income falls below threshold, SS would pick back up.
The one problem with people opting out, is if they become destitute, we’re not going to let them starve in the streets. So, we’d end up paying some benefits anyway.
Plus, a significant portion of SS taxes is for disability and survivor benefits at a younger age. So, maybe we have to have some tax to avoid those issues.
Many say we should just remove cap, but if we could increase taxes by 12.4 percentage points, a hunk of that needs to go to healthcare, childcare, climate, infrastructure, debt/deficit reduction, housing, jobs, education, etc.
We are in a real pickle right now, hope someone comes up with an answer besides a few tweaks to kick the can down the road for a few years.
Levy a Social Security tax on all contributions to a PAC. We either see reduced PAC spending or an increase in the social security fund. It's a net positive either way.
That's why the priority needs to be a) lift the income cap on social security taxes entirely (alternatively restart it at $300k), b) tax long term capital gains above $1M the same as earned income, and c) gradually raise the payroll tax by 2%, split between employee and employer.
This will not only keep social security solvent but also help rebuild the trust fund as a buffer, plus I'd also suggest doing what some Nordic countries are doing; allowing the fund to be invested in a combination of bonds and stock funds.
This (investment/privatization of social security funds) was proposed by Paul Ryan in some capacity back in the day, but he was buried for it. Also raising the cap kind of supports the point that younger generations have to pay more to support older generations. Demographics are no one’s fault. It’s a tough situation for sure. Nothing will be solved until there’s a crisis.
raising the cap is more about how the higher income earners should pay more into a system that is a social safety net. We were able to treat it as a 1:1 put money in, get money out, when the population of workers was vastly larger than the old aged and disabled. Not so much now
The big problem is that social security was supposed to be an isolated bucket. But in the 70s (I think), the govt allowed themselves to "borrow" from that bucket. Then suddenly it becomes insolvent.
The government does not borrow from social security, social security lends to the government. That distinction only makes sense in terms of sovereign finance, but it is critically important.
Yes, the mechanism is that when social security runs in surplus, the SSA buys T-bonds from the U.S. Treasury, and then when it falls into deficit, it sells those T-bonds (or lets them mature) to pull cash back out of the open market.
None of this changes demographic realities. SSA, which ran a $50-100B annual surplus during the 1990s, is projected to run annual deficits in the trillions by the 2030s. That's money that has to come out of the capital markets, which means significantly structurally higher interest rates in the 2030s.
I think they always borrowed against it. It remains solvent by 1) the population and therefore people paying in continues to increase, 2) the people paying in continue to make more and therefore pay more. Those are the 2 dials that enable current workers to pay for current retirees. An additional variable is life expectancy/duration of retirement.
In order to help ensure number 2, they have to keep the economy growing, so they historically use inlays over outlays for infrastructure that multiples the economy (interstate highways, power generation, etc). That's a much better use than having the money just sit around. It's like the difference between putting your savings in a brokerage vs a checking account.
Problem at this point is they've been spending multiples of the overages for decades with no real mechanism to reverse it and population growth is trending toward population decline.
Are we going to honor it, or are we going to disproportionately fuck with a specific generation that is about to draw their first checks after a lifetime of them keeping their end of it?
Fuck with the generation that has pulled the ladder up, everytime, every opportunity they've had to do so, while they're asking the young to once again sacrifice their own futures for the comfort of the Boomers?
There needs to be a solution that's equitable to all generations. Keep in mind that boomers have been fucking over the young for decades.
Eh it’s easy to point vaguely at “the boomers” but not every boomer is some MBA who stifled wages and made things suck. The majority of them are just working people like the rest of us. They did in aggregate benefit from a way easier time coming up for sure, I.e. more opportunity, but the actual snickering boardroom villains I imagine when reading your comment are a minority.
If some boomer has spent 50 years just… working as an electrician or whatever and is ready to retire, I don’t think he did much to make my situation worse.
Investing the Social Security Trust in stocks/index funds/equities aka private companies is equivalent to the boogeyman term of “privatizing social security”
But yeah you’re just describing a sovereign wealth fund which dozens of other countries already have. The genie is also out of the bottle now that Trump bailed out Intel and the U.S. Government owns 10% of it. We should absolutely do it.
That's what I mean. Remove the cap. Also there's no cap for Medicare payroll taxes, but we should apply it completely to long term capital gains income.
That's not how SS is structured, its a scaled benefit based on your contributions with caps for contributions and benefits, overhauling it into a mask-off income redistribution model isn't some easy button.
Welcome to the world of taxation. Why does a person with no kids in school have to pay for property tax that goes to schools? Taxes are to help the community, not directly to the person paying the taxes.
Because I pay for things I don't use all of the time for the public good. For example, I paid property taxes when I didn't have children and a lot of that went to the school system
I sure as fuck don't want to pay billions of dollars for needless wars and to feed the military industrial complex. Yet, here we are. Much of that money would be better spent on internal social programs and safety nets.
Lastly, I'm one of the people who would get hit if we lift the cap. Do it. I don't want to see my fellow citizens starve and be homeless in their old age. Why? Because I'm not a fucking selfish monster
Did you even read what I wrote before you started frothing at the mouth? I even called out other waste like the DoD which has never passed an audit and to reallocate that money. The DoD waste is far, far worse than what you wrote
Further to this, your percentage is likely wrong because of the tax return limitation. This data you are citing is based exclusively on federal income tax returns. Because low-income seniors whose sole revenue stream is Social Security generally aren't required to file tax returns, a significant portion of low-income beneficiaries are completely omitted from this dataset.
The older generations had fantastic economies that they drove into the ground for Gen Z and millennials to struggle in. Anyone without retirement money made a choice. Social security is a Ponzi scheme to keep Gen Z from ever owning a home.
You're angry at the wrong set of people. You're better off examining the upward wealth transfer to the oligarchs. Take a look at that and then tell me where the problem is
Also, there are plenty of people who work their ass off their entire life and don't have a lot of retirement assets (or any at all). Further to that, because of private medical care, elderly people go bankrupt as a result. 66% of all bankruptcies are due to medical costs.
Keeping people fed and clothed in their old age is the absolute minimum we should do as a society, especially the wealthiest country in the world
Same same, just do it! If Congress could actually implement some policy changes that positively impact labor and retirement we’d all be better off. But I’m quite sure they don’t know what they’re doing…..
You could do either -(a) lift the cap on taxed income and keep the benefits cap in place, or (b) lift the cap on taxed income and lift the benefits cap as well.
(a) covers about 61% of the shortfall (b) covers about 47%.
This option always makes the least sense to me, it's the option of not taking a side on what social security is, it's playing both that benefits should be proportional to "most" peoples income and the side that it's a redistribution program.
Be convicted on your beliefs, don't try to take a weak middle ground, either it's a program for all based on their contributions or be strong in changing it to a redistribution program.
We already have the AMT and additional Medicare tax. No reason why we shouldn’t the additional SS tax for high earners. Tack it on to households earning $500k+.
Lifting the payroll cap is a massive tax increase on high earners that disproportionately live in HCOL areas. 300k in California barely gets you a townhouse. It also doesn’t solve the problem. Just kicks the can down the road for the next generation.
We’d be doing the same thing boomers did to us and push the problem onto our children to solve just in time for Millennials to retire.
It does solve the problem you’re just against taxes being raised. I don’t understand how raising taxes is kicking the can down the road. If anything it’s the buck stopping with us rather than passing it onto our children.
Raising the social security tax cap also likely means the maximum benefit cap is also raised so those who contribute more will also be able to receive more in benefits.
What alternative solution are you proposing that doesn’t pass this issue onto our children?
Insolvency would be delayed by ~20 years if we remove the cap, right as elder millennials reach retirement age. This also doesn’t factor in second order effects (reduced economic growth due to higher tax rates).
The only sustainable solution is some combination of broad based tax increases and benefit cuts.
It seems like raising the cap or eliminating it entirely will inevitably need to be part of any plan then. I don’t see why it shouldn’t be part of the whole solution along with broad based cuts, allowing the SST to invest in index funds, etc.
It would probably be the most political popular and palatable part of the final bill
It actually solves nearly 80% of the problem and doesn't kick anything down the road.
Sorry if you're making $300k as an individual, you're pretty well off lol, and the tax increase would be on income over $300k. We're not rearranging an entire solvency plan around a few $300k earners in SF who say they can't get a townhouse.
We are also going to have to figure out a way to make AI workers (or rather their owners) pay taxes for Social Security to compensate for replaced workers' taxes.
You do this by taxing capital gains and/or wealth and having the money go to social security. Productivity gains have largely flowed to capital since the 1970s, which is why SS is in jeopardy, because it gets all its money from wages. Having it draw from both capital and wages would pin it to the overall economy’s growth, which would mean that AI’s contributions to productivity would benefit SS instead of hurting it.
> Productivity gains have largely flowed to capital since the 1970s, which is why SS is in jeopardy,
The whole productivity/wages/capital discussion is a lot more nuanced and complex than this - for instance if you index wages to PPI or the GDP deflator rather than CPI the gap closes considerably - because CPI tends to run hot vs other measures of inflation, it also creates a gap here due to the data measurement.
But the thing I really wanted to comment on was that this has nothing to do with SS's issues, the reason why SS is in trouble is 100% because of demographics. The population is aging, we didn't put enough money in there to pre-fund it across time, now that the population has aged the payouts are increasing like nuts and the amount of workers to support this just doesn't exist.
Right now all of that savings is profit, which means this would effectively be a new tax on shareholders. And there is zero chance of that happening in the U.S. So buckle up Americans, the ride is just getting started.
> We are also going to have to figure out a way to make AI workers (or rather their owners) pay taxes for Social Security to compensate for replaced workers' taxes
this actually solves itself - since you need 40 quarters to qualify for social security, all the people with no jobs won't qualify for benefits.
The problem is the government spent the money and its funded by what is coming in through future generations. Canada’s version invested a pool in the market and actuaries have managed it out to 2100 with no concerns of payments.
SS receipts in excess of expenditures are required by law to be invested in special treasury bills. This has been true since inception and is fundamentally the same as an individual investing in a government bond.
By law, the Social Security trust fund can only be invested into US Treasuries.
As the other commenter noted, Bush wanted to let a portion of it be invested in the market, but Democrats whipped up a fear frenzy amongst seniors and stopped it.
I’m very much a partisan Democrat and liberal but Bush was right and the Dems were stupid here.
Didn't Bush make it about private accounts, too, though? There's a difference between investing the common pool in the market and giving the wealthy yet another tax free investment vehicle.
I wish more left of center understood this. I am very much in your camp.
Silly thing about the opposition at the time was that they fear mongered that everyone would lose their retirement in stocks. Obviously they could have regulated what the accounts could invest in, so it was just fear mongering
Bonds went up because rates went down in the great recession.
It is all about what risk levels would be tolerated for investment. Individual stocks would be a great way for people to lose $n thus should probably not be allowed.
Plus government often steps in during times of emergency, like they do when extending unemployment benefits during recessions.
I would probably recommend to include in such a law that any investment allowable in the accounts has to meet certain criteria such as investment mixes based upon age, etc.
Put a tax on distributions to pay for the emergency contingency funding
Why did social security become invented? It was a response to the consequences of the Great Depression and the stock market crash. Social security is meant as security, not an investment.
Passive investment is a better vehicle than taxes on labor because it is always rightsized for the demographics versus being victim to it as we are with the boomer bubble
There were a lot of technical arguments (implementation, admin issues, what investments you could choose), but I think the main ones were:
- Risk: It transfers risk to individual retirees. Instead of a 'guaranteed' return, it could mean that if the markets did poorly or you retired during a market downturn you would get less.
- It wouldn't actually solve the SS solvency issue and would require a lot of government borrowing to fill the gap left by funds being diverted to private investments. I think the low-end estimate was $750B in additional borrowing (back when that was a lot of money).
It wasn't just Democrats who resisted (though they lead the charge). AARP also pushed back and the Republicans in congress weren't particularly excited by it, so it never actually got to a vote.
Yep. Also even 401ks were kinda relatively new thing and Jack Bogle had just started preaching about index funds in the late 1990s. I think a similar reform could be passed nowadays if the Democrats pushed it.
I didn't like Bush as a president but he was ahead of his time on this reform.
My concern at the time was based on a distrust in our government to avoid corruption and not have money subject to partisan bickering. What stops Trump from forcing the SSA to spend $2 trillion dollars acquiring a minor interest in Trump, Inc.?
That’s a problem every sovereign wealth fund faces, which is what if whoever is in power could corrupt it and have it invest in whatever that person in power wanted.
There could be guardrails, such similar to the federal reserve, or what the Norwegian sovereign wealth fund does to protect its independence.
The first rule of politics is courting the fresh meat because they aren't alive to remember the mistakes your party made, and the lies and hypocrisy and corruption
We are living in the most corrupt administration in history. Just look at how oil futures are traded 15 minutes before Trump tweets or how much is traded before a random tariff is applied.
It would have needed 60 votes in the Senate and Democrats uniformly opposed it. They actually did good job of scaring the public about it and Bush dropped it from his second term push because of the poor public opinion it started to get.
The alternative would have the American government be a substantial shareholder in all publicly traded companies in the United States. Now I don’t have a problem with that but there’s a certain political party that up until a year or two ago would have an absolute stroke for suggesting something like that.
The problem is that all the commonly suggested solutions have some pretty hard down sides. There's no good solution.
Want to raise SS taxes? Great, you've just put the largest tax increase on the lowest income levels in decades. Even 2% ends up hitting every wage earner. People won't be happy, voters will turn on whoever does it.
Want to raise the cap? Then you put a big tax increase on upper middle class wage earners - not the wealthy millionaires. The marginal rate jumps from 24 to 32 just past the SS cap. The government takes that 6% (and then some) and throws it into the general revenue fund instead. That's also about where additional Medicare tax kicks in. You're smacking doctors, lawyers, engineers, and other high income wage earners with nearly a 50% marginal tax rate. The millionaires won't be affected. It's a shitty solution, but likely would pass because it doesn't piss off the bulk of voters, and only hits people not rich enough to lobby against it.
Cut benefits? You might be vastly overestimating just how much social security pays out. The average social security check for retirees is $2000 per month. If you have the max number of working years (35 years) with maximum contributions and wait until 70, you'll get like $5000 per month. This is also political suicide.
Means test? This ends up hitting those who probably are maxing out their social security and getting that $5k per month. What it means is you have people who will have paid into the system but won't benefit from it, which at some point is pulling the rug out from people. It's probably the least shitty solution though. The high income retirees won't miss it that much. Some retirees on the cusp of whatever those brackets end up being probably start creative accounting though.
Raise the retirement age? Frankly we already have a problem where older people are hanging on in the work force and younger workers are having a harder time being promoted, which also cuts off entry level jobs. We lowered the retirement age with reduced benefits to actually encourage people to get out and reduce benefits overall. Which is why you take a big hit retiring at 62 instead of 70 (it's over a 50% reduction).
How about making lane splitting legal for motorcycles. It will eliminate a lot of future social security recipients and as long as there is not an accident will speed up our traffic logged roads.
You left out a lesser talked about solution, tax corporations with a subtraction method VAT tax. IMO all welfare funding and most government funding needs to be moved off a labor tax as fast as possible. The technology is threatening to spike unemployment which will collapse the tax revenues.
It's pretty much without a doubt that whoever ends up having to make the tough calls and actually make a decision (Democrats) will lose the following election because Americans hate taking their medicine.
It would depend and overall should be price neutral but it would be a messy transition. Labor intensive businesses would get a tax reduction while labor light businesses would get an overall tax increase.
Social Security has always been a program where the younger population is paying for the older population.
And for what it's worth, boomers did vote for politicians who made a lot of adjustments to Social Security. In 1977 they adjusted the COLA increase (creating the notch babies who got screwed), then increased the payroll tax for in the early 80s, raised retirement age from 62 to 67, and then raised it to 70 in 2008. The 2000 election had a big debate between Gore's lockbox and Bush's "investment" (aka privitization) plans. It's really been the last 20 years, as boomers have been collecting social security that the government has been afraid to touch it.
While I'll happily blame a lot of the world's problems on the boomers, it's not fair to say they did nothing to try and fix this situation for 60 years and now want young workers to bail out social security.
The payroll tax increase was in the context of Reagan's massive tax cuts - it was basically Ronnie and Greenspan making a major change to more regressive taxation is all.
The Boomers entire time as political leaders has seen massive deficits and debt, usually in giving either tax cuts or benefits to themselves. And that means that the "trust fund" exists as a debt competing with a massive US debt that we're currently see spiraling out of control at all.
Boomers' have always been determined to throw this shit pile onto the young - it's why the benefits will be cut in the future, when most of them will be dead, instead of now.
We literally don’t get that button, we get to select between two geriatrics who are beholden to corporate interests more than their constituents. And in many cases our vote has less impact than someone in another area simply because of where we live
Honest question - why not tie social security reimbursements to total wealth (including retirement savings)? If you're worth 7 digits, receive a pension, and have multiple houses, not sure why you should receive the full Social Security benefit.
So two people work 45 years, same job, same income.
One lives an extremely frugal lifestyle, drives a beater, shops at Goodwill, packs his lunch, takes staycations, etc., and invest in a couple rental properties, funds his 401(k) with the savings.
The other, spends everything on maximizing their lifestyle, gambling, drugs, etc..
Neither.
Both of them voted were part of a group that voted to underfund government t and start stupid wars for 40 years.
Some of that gains the frugal one has gotten is from the underpaid taxes and the way government has been systematically advantaged to favor capital ownership over labor. So yeah, they both take a haircut
I am happy to return your funds with 8% interest rate. Get off Medicare and social security. Good lucky buying healthcare at your age.
Unless you die young, most elderly are still getting out more than they put in even after account for returns
We will refund you your amount . Get off social security and Medicare!!!
We will even return it at 8% annual interest rate. Take your money and go buy insurance at a rates for elderly
I think the easiest thing is to tax all W2 income and not just the first 184,500.00. By the time many people reach the ceiling they are already used to it coming out of their checks, so just keep going all the way up to where a person's income tops out. Medicare already taxes all income and the percentage goes up a little once you reach a certain point. Might as well do it with SS as well.
They could just lift the cap. Not that difficult of a solution that would only impact the upper 1% of income earners, who have also benefitted disproportionately from mass tax cuts over the last 30 years.
Lifting the cap hits wage earners, not millionaires. That's aiming a 6% tax increase on wages already being hit between the 32% and 37% bracket. The people who end up paying it are basically the people who are upper class. It's the people in that $200k to $600k range who end up taking the brunt of it. The group too rich for tax cuts, too poor for tax loopholes, and don't donate enough to keep Congress off their back. It hits a section of the population that's small enough that politicians can get away with it.
I don’t think it’s enough people in that 200K to 600k group to really cover the costs
And if you are staring down a close to 50% effective tax rate (federal, state, local, SSI, Medicaid/medicare) and still having to pay for your own healthcare, it’s time to look at moving to another country
No, but it would kick the can down the road a little more. It's a shortsighted band-aid that only really screws over a small group of voters so there's a chance Congress might actually do it.
Right. I dont want to pay another 7k in tax just so fucking boomers can ride off into the sunset scott-free. If I'm going to be required to pay more in taxes, I want to see either a benefit cut, a means test, or both implemented too, because i dont doubt for one second that's what's waiting for me when it's finally my time to retire. They need some fucking skin in this game too.
Frankly that's what I expect will actually happen. Just like Medicare hasn't been funded for years and they just allocate budget for it. The same thing will happen to Social Security and it'll just increase deficit spending, at which point we better hope the MMT guys are right about debt.
And they likely dont have movable business capital to change tax jurisdiction immediately. They are likely employees with a lot of skill capital that wouldnt pay that well in most other countries worth moving to.
Yeah, just tax upper middle class families in HCOL areas an additional 12% so people who live in lower cost of living areas can be subsidized even more. Completely fair to everyone
There's one more suggestion that will create complaints from the xenophobic party -- increase immigration of skilled workers.
This is an almost immediate increase in the paying base for SS. Particularly with higher paying, skilled labor, and professionals. Attaching a green card and citizenship pathway to any foreign born student graduating with a technical or scientific degree will practically guarantee more input into the SS system.
But you would be making a shortage of jobs for US citizens that are just as smart and skilled as immigrants. I am all for it as long as US citizens are used first.
Cutting benefits also means more pressure on working taxpayers as they now have to directly support elderly relatives who will not be able to afford to live independently. Or more elderly people qualify for low income benefits at the state level shifting costs to states.
I addressed that one. The problem is old people not leaving the work force. We're already seeing issues with boomers not retiring keeping younger workers stuck in mid level and entry level jobs and lack of opportunities for promotion and hiring.
Right now, you can retire at 62 and take a hefty reduced benefit, or wait until 70 to get the max benefit. What's more likely is stretching that to 75 for the max benefit. Lowering the retirement age for reduced benefits actually saves the program money. If you retire at 70, it takes about 10 years to make up what you would have brought in if you retired at 62. Only 8% of social security recipients wait until they're 70. So basically for 92% of the people over 80, the government is saving up to 30% on what they'd otherwise be paying because those people took social security early. And that actually puts it in line with life expectancy, half the senior population doesn't live beyond 80, and the half that do are mostly being paid at a discount.
If you really wanted to troll gullible people, they'd lower social security even younger for an even greater reduced benefit.
It's really about betting whether you're in the 50% of people who live past 80 or not. That's basically genetics, look at your family, look at your health, and place your bet.
If you don't actually need the money, then there's an argument to take it at 62, invest it, and try to beat an 8% yearly return and you'll beat out waiting until 70. But if you're needing that money to live you can't do that.
Exactly this is something that a lot of folks don’t seem to understand. I know someone who is in their mid 30s has been with the company about 8yrs and they outsource a key finance task to a 90 year old man who is retired and has a pension and has everything, but for some reason their CEO hangs on to this person and doesn’t bring this task in house which would be the best for everyone. This man has almost died a couple of times right on their reporting deadlines and those have been my friend’s only chances to shine. He’s a good guy but damn retire man go sit in a recliner or something for a little bit it’s like what do you need all this money for? It’s not like he doesn’t have good healthcare he was a former wall street guy.
Throw in Medicare at 62 and cover younger spouses and you would see many retire. The 70 year old with a 60 year old wife still has to provide insurance in many cases.
That will only help so much, plenty of people do not have the capability to keep working much longer. My mom got dementia at 65, I have a friend who got rumetoid arthritis at 64, etc.
It might help some but you need to be aware a whole bunch of those people you expect to save money on by not giving them retirement social security will instead end up on social security disability.
Most people work 20 years minimum anyway, right? Like I got 8 SS credits from working in high school for two years. 10, or even 20, years of credits is quite easy to get. I can’t see this affecting anything.
You cut out all the people who work in the black market economy during their prime years then get a job from 52-62 for their check. If they have to participate 20 years it will help everyone because you only need a job that pays 2k a month for 10 years to get get 2k for life rn. The math doesn’t math.
Means testing would politicize it under the bucket of “welfare” and lose bipartisan support . Granting everyone access to a program is the best way to keep it popular
How about applying the ss tax to capital gains AND removing the cap? Then close tax loopholes like taking loans out against investment portfolios to avoid ever realizing gains. Finally, take SS from everyone with more than $1mil annual income or $5mil in assets.
No. The simple and effective solution is to remove the cap so that wealthy people continue to pay into the system after they pass the current, ridiculous threshold of $184,000. Those who benefit from that low threshold can easily afford to kick in the same % of their income as the rest of us do.
Means testing SS will kill its public support even if a small percent are impacted. People in this country love to pretend like one day they will be rich and these policies will affect them when there is nearly a 0% chance that will ever happen
Have you heard about the donut method? You return the full tax at a particular income level rather than uncapping in totality. Affordability is also at play here. None of this matters if cost of living continues growing at rates well above pay/benefits.
The solution is likely a mix of things - raising revenue via the donut method and a percent or two increase (and ensuring the contribution continues to be split evenly across employer and employee), some mechanism for cost reduction, and some level of either benefits adjustment or alternative funding mechanism.
And it's pretty counterproductive to say "we've tried nothing and are all out of ideas!". You're right that there's no perfect solution, though every day we wait to fix it the gap to solve grows.
Another unspoken drawback to significantly increasing SS taxes is that there is only so much political will and tolerance for hefty tax increases.
You want to spend it on this instead of increasing say, health care, eduction, child care, etc? Those are all heavy lifts already, doing them after a massive SS tax increase would be pretty much impossible.
If we’re going to abandon the idea that SS is an “earned benefit” w Reddit’s favorite solution (eliminate the cap w no additional benefits)…I see no reason why this should just be funded by a payroll tax.
If we’re going mask off that this is a welfare program for seniors - it should be funded by all types of income.
Putting ever more burden on wage income when wages are a downward sloping % of GDP since the 60s is not sustainable.
It is a defined benefit plan in substance and structure though. If it was a welfare program we would see traits of that: it would not be an entitlement, the benefit amount wouldn't be tied to past income, and the cost would be a lot lower for those reason.
It only smells like a welfare program based on the state of people's finances and the amount of the typical benefit. They depend on it. But just because you depend on a benefit does not make it welfare.
My point is if you eliminate the cap on contributions without giving benefit credit for the earnings, as is favored by many, it can no longer even remotely be considered a defined benefit plan
Well that “fix” should definitely make younger people want older people dead! How about TAXING THE ELITES!!! How about that? God Damn this country is so fucked!!
For your daily generational warfare spark tune in here....
Don't worry kids. They've always done this bullshit. If they can't convince us that the other colored person is the problem, they will try to convince us that the age difference is the problem. Meanwhile, the rich people just run off with your money.
of course older people have more money on average, theyve been in the workforce 20-40 years, and have had time to accumulate assets. that dosent mean they are the 1% class who is currently grifting and robbing our country blind.
The boomers are the rich people though? They hold the overwhelming majority of the wealth as well
as government power, why wouldn’t the age be relevant?
If we had done even basic fixes a decade or two ago, Social Security could have easily been kept solvent.
By waiting until it's an imminent crisis, only drastic changes can even hope to make a big enough impact, and they'll be so hard to swallow that the backlash and the crisis can be used to further sabotage the program and any effort to maintain it.
Same goes for basically every other looming crisis we face.
No one's going to do anything about it. We're seeing in France today some of what it'll look like if they try to do anything about it. We'll keep letting everyone have everything and then one day no one will have anything. Or something like that. I don't know, my coffee hasn't kicked in yet.
There is serious analysis and proposals on this that congress wont look at. Talk to them.
Eliminating the cap gets you far, but not all the way.
Currently workers pay 6% and employers 6%.
Raise it a little each year, in combination with lifting the cap, and hold your geriatric congress folk accountable for passing the law now instead of in 2033.
Don’t raise the age. People cant find good paying jobs after 62 and get targeted for layoffs.
i mean, none of this wrong, but it seems very unfair to raise taxes and not cut benefits
it’s a tough question because unilateral cuts would put a lot of seniors on the streets, but without some level of means testing of benefits, we’re not fixing social security, we’re fucking over the young so the old can collect
Absolutely raise the age. The average life expectancy in the US in 1935, when Social Security began, was 61.7. The average life expectancy today is 79. If we’re inflation adjusting benefits and raising contributions we should be raising the pensioner age as well.
Just because people live longer doesn’t mean they can work longer. The age is what it is because that’s when people start to suffer from age related disabilities that make them less productive. That has not changed
>The average life expectancy in the US in 1935, when Social Security began, was 61.7.
But life expectancy at age of retirement was much closer to what it is currently. Life expectancy for those who made it to 65 hasn't grown by nearly than much and we've already raised the age of full retirement by two years to adjust for that.
Why is no one proposing means testing benefits? Currently over $200 billion per year in Ss benefits go to millionaires. The average recipient is much wealthier than the average payer. It's a deeply immoral system
Everyone here is saying young poor people should have to pay EVEN MORE so that old rich people can continue to receive money they don't need. It's beyond ridiculous. And yes, keep down voting without replying, because you know I'm absolutely right
While many people view Social Security as a universal insurance program where "you get out what you put in," it is effectively means-tested through three distinct hidden mechanisms: a highly progressive benefit formula, the taxation of benefits for moderate-to-high earners, and strict pre-retirement earnings penalties.
You’re sticking it to those people… you’re actively punishing a group that decided to save money and grow their retirement accounts over time. If you’re going to means test it then let me opt the fuck out completely.
Social security was established as an earned benefit. Now you’re flipping it on its head and saying because you don’t want to tax rich people more and lift caps it shouldn’t be an earned benefit but a means based benefit.
> flipping it on its head because you don't want to tax rich people more
Taxing rich people is functionally the same as reducing their benefits. Sure, we could tax all rich people receiving social security to obscure the fact that it would be a benefit reduction, so that their feelings might be hurt less. Thats one way.
Fun fact, Social security taxes are similarly deceptive. The "employer portion" is really paid by employees in the form of lower wages. So it really costs you 12.4% of your income, not 6.2%
The pyramid scheme is showing its holes in real time. It's sad because, as a kid, when I first got a job, I remember an old timer explaining social security to me in a way that made me feel like, "nice, I'm 14 and am paying into it early. I'll have so much when I'm done."
Am I understanding the proposal correctly? It only wants to raise the tax rate but not anything else? It should be paired with raising the retirement age, eliminating the payroll tax cap, and potentially limiting benefits to the wealthiest individuals.
It should be. Net net, we should do several things in moderate amounts: lift the cap, raise the tax rate, raise the age of eligibility, and lower payments.
Raising taxes just to pay for social security means that those dollars will not be available for other uses. Mainly closing the deficit.
It does but with longer life expectancies and a terrible fiscal situation we all need to sacrifice for our lack of budgetary prudence.
If younger Americans are asked to contribute more, older Americans must also be asked to take less. And of course the wealthiest among us should be responsible for sharing more too.
And yet here we are, the wealthiest nation in human history, talking about who has to sacrifice more. Perhaps we should look at where all the money is and ask why its not flowing more evenly? Perhaps we should focus our combine outrage as a nation not on old vs young, black v white, lady v guy and instead focus on the haves and have nots and how to close that gap.
_Everyone_ has to sacrifice more, but especially the wealthiest among us. I don’t disagree with that at all. That doesn’t mean regular people might have to come to expect less in benefits. Our fiscal state is genuinely horrible.
I mean, even if you somehow taxed every billionaire at 100% you end up with 2 years and change of entitlement spending, and that’s without accounting for any increases for things like M4A or SS solvency or the remaining portion of the current budget + deficit.
This idea that we could just fund anything by only taxing people who have way more money than they could ever need just isn’t grounded in reality.
The worker to beneficiary ratio is out of control, and is one of the most important aspects of keeping SS funded. Raising the age would help it.
When SS was created, the worker/beneficiary ratio was about 16. From 1960-2000, it was around 3.5 to 5. Now it’s about 2.6. The average monthly benefit for a retiree on SS is about 2,000. That means the average “worker” would need to contribute about 770 a month. Since the SS payroll tax is 12.4%, split evenly by employer and employee, we’d need an average individual income(not including income over 192,300 because of the stupid cap) of 6,200 a month, or 74,000 a year. It’s difficult to find the average income excluding income over the cap, but the median individual income right now is about 55,000.
The math is just not mathing. We need some combination of the following: removal of the cap, increase in the retirement age, reduction in benefits, increase in the payroll tax.
Most people do not want to see a reduction in benefits or increase in payroll tax, so we are left with removing the cap on contributions, and raising the age.
US life expectancy is 79 today compared to 75 in 1983 when we set the full retirement age to 67. Our birth rates are also much lower today.
I also believe the wealthy should contribute far more, but at a certain point, basic math kicks in. You need everyone to take less and give more in increments.
And other “high income” nations have an average life expectancy of 82+ yet they have better social security programs than the US. What did they do different than us that keeps them from having to increase retirement age? We should do whatever they are doing before even thinking of increasing the age to full SS.
U.S security funding aside from France has allowed those countries to be pacified and divert spendings that would have been used for defense into their social benefits.
Additionally, practically every other developed countries - especially France, is now coming to terms with their enormous debts piling up and having to reckon with cutting social services due to their lower GDPs, increasing deficit, and taxes being unable to sufficiently fund pensions
They have been increasing their retirement age; Denmark is gradually increasing to 70 by 2040, France recently went from 62 to 64, UK is gradually increasing to 67, Belgium going to 67 by 2030, Finland tying it to life expectancy, Germany going from 64 to 67 by 2031, etc....
On top of it those systems are also struggling to to stay afloat, increasing taxes along with retirement ages is common. Some systems are pushing 30% combined tax rates just for their forms of social security.
25% of people that make it to the 67 retirement age die before they reach 79.
So we’re saying that the less than 12 years that people get to enjoy retirement after giving their whole lives to build and sustain the nation should just work until their deaths.
In 1983 the probability of a 67 year old reaching age 75 (the median life expectancy then) was ~77%. Today the probability of a 67 year old reaching age 75 is ~86% as Americans are living longer.
To get back to a ~77% figure relative to today's life expectancy, an equivalent full retirement age would be 68. So raising the retirement age 1-year to account for longer lifespans.
With the expectation that we (especially the wealthy) should all contribute more in taxes, it's also not so far-fetched to raise the retirement age by a year if it becomes necessary for solvency. Obviously I'd like to delay that as long as possible.
The average lifespan has increased dramatically over the last few decades, even if it’s seen a slight bump in recent years.
When social security was created, the average lifespan at birth was 61.7, while the full retirement age was set to 65. The average lifespan was 3.3 years LESS than the full retirement age.
Now the life expectancy at birth is about 79, and the full retirement age is 66-67. Since SS was created people are expected to get almost an extra 2 decades of benefits.
Even if we use life expectancy at age 65 instead of at birth, people are getting far more years of benefits now.
It is long past time to raise the retirement age. People can still retire earlier, they just need to self fund their retirement until the new age. Some people won’t be able to, but there’s no perfect solution here (other than raising taxes on the wealthy, but politicians who try this are doomed to lose their positions the wealthy elite will just fund an opponent in the next primary/general if they get too out of line)
When social security was created, the life expectancy was lower than the retirement age. People are living significantly longer now. You're speaking from what you want, not running a solvent program
You either lower benefits, increase retirement age, or increase taxes, or a combination. I hate relying on only raising taxes. I pay enough.
Maybe on the rich, but please no more for me and other poor people. A huge part of our burden if supporting the elderly and it’s about to get a lot worse.
Really should create a 20 year window where people with a certain amount of wealth don’t get paid out at all. The top 10% don’t need that money, and they aren’t entitled to it since they mortgaged our generation off to fund it
The question is whether it's going to be broken now or in the future. We can't honor it forever. The problem with just raising taxes is that the younger generations that have to pay that higher tax will also get lower benefits when they retire.
So okay why should 1 generation be forced to both pay higher taxes and receive less benefits while other generations get to keep the higher benefits while paying less into it?
GenX is already currently that "one generation" that you speak of. We already saw the deal modified in our lifetimes. Full benefits began at 65 when most of us started working, now they begin at 67.
All this talk of "saving" social security.. GenX already paid that lump. We already saved it. Another generations turn now.
Then voters will turn against it because it will be seen as welfare, like SNAP. Congresss will then underfund it and people will demand they not pay in to it if they aren’t getting it
The old are always going to be in favor of basically enslaving the young, and the old vote, and their vote share is increasingly getting bigger as the birth rate plummets. It leads to a death spiral (pun intended) that collapses a civilization.
or a massive tax hike on the ultrarich. ....they've benefitted from lax business policies, low corporate taxes, low capital gains taxes to further enrich themselves with massive compounding of their discretionary wealth via massive asset appreciations. It's time they pay up their fair share of the economic benefit they've received. Else they'll continue to use their excess wealth to influence government policies and elections for their own narcissistic needs, at the expense of the struggling middle and lower class.
Just drop the cap and lower the rate and make it solvent for the next 75 years. Those under $180k pay less in taxes. Those $200-300k pay about the same. Those above $300k pay more.
There's a cap on benefits too. What you're suggesting is a 12.4% increase in taxes for people making more than $180,000 and they would get nothing in return for that
Agreed. And they'd be paying for a significant amount of benefits for many retirees who don't need it, and who are pulling out more than they put in. Fuck that.
Stop exempting unearned income. Right now, only earned income is taxed for SS/Medicare, while the parasites are free riders on a function that keeps society stable and working. Lower SS tax rates but apply those rates to unearned as well as earned income.
Why should people who don't earn their income be allowed to avoid taxes?
They shouldn't get a lower rate for cap gains either. There's more than enough capital available to fund the economy there is no need to give a break to encourage it.
I would remove the salary cap for contributions, raise capital gains taxes, limit social security benefits for high earners ( despite their contributions ), but keep the current rate.
I say this as someone who has been getting social security payments for 20+ years already.
I would not complain about my benefits being reduced, but I would complain about those who are less fortunate getting their benefits reduced.
I think the limiting social security benefits is a sticking point - I think it's ok to take more from high earners but the point of these systems are that they are safety nets for all.
You had a high income but you had a divorce, then a medical issue that ate your remaining assets around retirement time. This person who paid in a lot to the system is now ineligible because at one point in their life they didn't need it? Especially because of how medical costs can bankrupt people, we shouldn't be excluding anyone that paid into the system.
Many of these discussions from both parties seem to first narrow a set of possible interventions and then throw their hands up after the selected set of interventions doesn't resolve the deficit. So many options: removing the cap on taxable income for Social Security, adding some tax to realized gains, etc.
If you were a Boomer born in 1946 and who started work in 1964, your OASDI tax rate increased 61% over your working life. But those changes were spread out over 30 years. Politicians kicked the can down the road and relied on the Trust Fund, that the outsized Boomer generation helped build up, to ignore the problem. Now that the Trust Fund is close to being depleted, they need to make large adjustedments all at once.
The problem isn't that the tax rate needs to go up. That has happened for every generation, except Millienials and Gen Z, again thanks to the Trust Fund. It's that politicians didn't want to make reforms when the changes would have been smaller and easier. And now they have to do something fairly drastic.
Exactly. Conservatives want to end SS so that old people can't afford to retire, and instead keep slaving away for the boss man undercutting the value of labor for younger workers in the process
Right! Because between 1964 and 2026 the Democrats have never once had control of the senate, the house of representatives and the presidency at the same time.
Smh. Its the boomers that made a choice to spend their retirement money on Vietnam and bombing brown people. I will never understand why kids much younger than me have to pay for me and other able bodied men to sit at home for 40 years, not working, mocking the people who are working, and literally voting to hurt you guys. What did we do exactly that I get your money before your kids get school and healthcare? This shit shouldn't be in 8 years, it should be full stop right now so that the people who voted to spend that money actually have consequences for their choices, not you guys...
>spend their retirement money on Vietnam and bombing brown people
This sentence is peak reddit. Confidently incorrect, blaming "boomers", and attempting to make everything about race.
Baby Boomers were in their late teens, early 20s during Vietnam. They were drafted to fight the war, protested the war, and had little influence on policy because there just weren't as many of them compared to the size of the population that was thirty years or older at the time.
It was their parents and grandparents that were making the decisions. They are long dead.
Uhh, social security is it's own self funding program with a tax that goes to it and it alone, it is not part of the general fund. The major problem for once isn't the boomer era but your parents and grandparents, the older generations paid far too little in and got too much out; planning for the population to continue growing, relying on the working population always far exceeding the retired.
For most of the boomers working life the total SS tax paid has been over 10% of your income, while for your parents and grandparents it was mostly under 7% going as low as 2% at the beginning.
If boomers have any blame in this it is having less kids than previous generations and generations after you are compounding that fault, but in many ways less kids is a good thing.
Reduce benefits by 4% a year and raise the tax by 1% a year between now and 2032. We'll tighten our belts a bit but save the program for ourselves and future generations.
Once the workforce is larger than the number of retirees, it'll be a non issue.
Correct. This is kicking the can down the road, while squeezing the younger generation harder, reducing the number of children they can have even further, and it will have to happen even more.
Taxes rising on the young while the fertility rate is below replacement and falling is not sustainable, including for the people who would like to be recipients of the social security.
I think there's a pretty big difference between 2055 and never.
My assumption is that we have at most another century of shrinking generations until a little rebound is inevitable (oversupply of housing will make it cheaper, smaller tax burdens for smaller populations, likely fewer regulations in more sparsely populated areas, and so on will make it a lot easier to find your feet and get on them).
The old are always going to be in favor of basically enslaving the young, and the old vote, and their vote share is increasingly getting bigger as the birth rate plummets. It leads to a death spiral (pun intended) that collapses a civilization.
Benefits will have to be reduced but they’re never going to come out and directly say “5% cut to SS next year.”
The most likely solution for cutting benefits is revising COLA to mirror Chained CPI.
You’ll probably see a plan to have differential COLAs depending on benefit level. So those getting higher SS payments will not get the full COLA.
We’re also likely to get a combination of :
1-2% tax increase
a full retirement age of 68-70
more quarters required for eligibility (40 to 60/80)
increasing the cap to ~$250k a in income
reduction of spousal benefits
changes to SSID program
more bend points on benefits reducing the return for higher income earners
state and local employee inclusion into the program
possibly some privatization to get investment returns into the fund.
Also, this is 100% going to come out of a bipartisan finance committee. Whoever is president will agree in advance to sign whatever bill comes out of the committee. My best guess is it will happen in 2029. Neither party is going to want this hanging over the 2032 election.
Reduce benefits for the boomers by whatever is necessary to fix funding formula for future generations. They messed it up, failed to fix it, and deserve all the blame/pain.
Why not just uncap the social security tax? That would fix it right now, and involve pretty much no belt tightening for anyone who it wouldnt be a rounding error for
Because right where the wage limit gives up on social security taxes, an 8% increase on income taxes kicks in. You don’t save any money, the government takes it for a different pot.
You shouldn’t have to pay 40% of your income in federal taxes alone after $180,000. That hits upper middle income families hard in cities. Once you tack on state and local taxes you’d be taking more the half their income which is a worse deal than even serf farmers got.
Most W2 high earners are actually carrying a European style tax burden without the benefits. This would push marginal tax rates to almost 70% in some states. The fiscal drag would be immense and when Warton modelled out a cap raise (to somewhere in the mid $300k) it slashed 3% off the 10 year GDP and cost almost a million jobs. There's no tax side fix for this that doesn't risk a recession and immense economic pain for everyone. There's well over a trillion dollars in unfunded old age entitlements. The boomers were warned about this for 40 years. Benefit cuts will have to be part of any realistic solution.
We have the most progressive tax system in the OECD.
But all you’ll hear about it from people is how the rich don’t pay taxes.
No, it’s because we blow an entire middle class street worth of lifetime tax contributions on a missile launched at a man and a donkey in Iran every 10 seconds.
We’ve also created a class of people that pay minimal taxes because they don’t make the majority of their money through salary. Corporations intentionally pay low salaries, but have guaranteed payouts in options in the millions to avoid salary taxes. The problem is the salaried people bear the burden of paying the most proportional taxes while multimillionaires can afford to cut their tax liabilities to a single digit percentage of their income. We can’t keep cutting loopholes for them, and saying loans on stocks, or compensation on stocks enjoy indefinite differed taxation.
Yes, but the government also don’t provide half of what European counterparts do. Half of that is the dumb amount of corporate subsidies we provide and the other half is our penchant to run military campaigns for stupid ass reasons only to make us more vulnerable.
I’m not even going to cry for the C suite people but those guys are paying half their checks in taxes, it’s the owners of these businesses that are paying half the tax rates.
Even stock comp is taxed upon vesting as ordinary income.
Get a million in RSU? That’ll be about 50% upfront to the government.
Just want to praise the sanity and intelligence of this group compared to the typical social security discussion I've read on reddit.
As a high income individual myself I strongly oppose eliminating the cap. As most have said it's a 12.4 percent increase and would be the biggest tax increase I've ever seen and would push my tax rate a bit over 50 percent when you include state, local etc.
This is what very high tax rates do. Without doxxing myself I'm a medical profession and am a sub specialist. I do a few weeks a year of locums at a smaller rural hospital because they don't have access to all the medical care and all of the specialties (I actually get paid less per hour compared to my full time job at a larger institution). This require being on call and coming in at night as well.
So it does exactly that...it makes me less willing to sacrifice my time, body to try and fulfill a need that's being unmet in smaller communities. And yes money isn't everything and I do enjoy the work but its an additional disincentive to do it.
I’m exiting the workforce soon for this exact reason.
My partner makes enough to put us in the top bracket and it really makes working pointless from a financial POV. I maximize tax advantaged accounts but even in a low tax state I’m paying over 50% marginal and nearly 40% effective.
I’ll spend a few years with the kids and making the home life easy af over 45 hour weeks and running around in circles.
This, people wonder why this country is setup to just passively invest and take it in and look no further than a tax code the disincentives people to work.
This would be a problem in any industry with high earners. Do you really think a 50 year old Airbus Captain in San Francisco is going to wake up at 4 in the morning, battle traffic, and deal with airport coffee, to take six tons of steel and fling it 500 miles an hour to New York for 38 cents on the dollar? No! They just don't pick up that trip. They make less money but that's money that wasn't created to tax. In addition to being a goofy idea for other reasons, uncapping social security also hurts the general revenue.
It would be the largest peace time tax increase in American history, distort the economy, and not even fully solve the problem. That's before you get to the practical argument that raising taxes as high as they can realistically go to pump out a third of the funds to people with over $100 k a year in non social security income is even a good idea. It's a silly idea that panders to the 60 plus voting block or placates the people who are mad some lawyers make $350,000 a year and they don't. If America has the appetite for a trillion dollar tax grab let's put food in children's mouths and fix our crumbling infrastructure rather than worry if a retired dentist has to dip into their multimillion dollar Fidelity account for the upgraded beverage package on their second cruise of the year.
This is what gets me. I’m Gen X and people were talking about the Social Security problem in the 80s. So Boomers, X, and Millennials all decided to ti ignore the problem and spend the SS money on the general budget. Well, since we spent the money, we have to take cuts to benefits
The actual problem is that boomers decided they didn't want to pay realistic payroll taxes for what they were promising themselves. For the first 40 years payroll taxes were increased 17 times, usually half a percent every few years. When the new rate was set in 1983 the actuaries knew even being off a tiny bit could cause huge distortions over time. That wasn't a big deal! You just do what had been done every time the math was off for 40 years and raise taxes. The boomers broke this "sacred generation bond" when in the 90s the math showed a swelling gulf between benefits and taxes and they refused to raise their taxes to meet the problem. They then continued to refuse to fix the problem as it worsened for 40 years. Now that they are no longer working people they want massive tax hikes on young workers when they refused even minor tax increases as working people.
No it won’t. The realistic solution will likely be SS taxes kicking in for individual income over $300,000-$400,000 with no tax on income between the current income cap and the new number.
Doesn't solve enough of the problem to be worth it. It's a numbers game and there are more dentists and optometrists than people on an MLB contract. Some kind of a 1-2% surtax might be viable without massive economic effects but I think people are vastly underestimating the scale of the problem.
This is would be a disaster for the Democratic Party. They’ve finally become the party of the highly educated, high wage earners and demanding higher taxes only from them would be a gift to the GOP who will promise to lower taxes.
I know everyone wants someone else to pay for things but a 1% tax increase across the board, a raised cap (not removed) and a minor benefit cut would be far more fair. It hits everyone a bit but those who can afford it a bit more.
You can go here and look at the actuarial analysis of all the different proposals to fix social security. Eliminating the tax cap and providing benefit credits for all additional payments resolves 45% of the long term actuarial shortfall.
Eliminating the tax caps and not providing benefit credits above the current max resolves 58% of the long term actuarial shortfall.
There are several other proposals listed that fall in between those 2.
Temporary fix, sooner the cap is lifted the longer it extends full benefits. If I recall correctly eliminating the cap now would extend solvency for 15 years. There is almost no way to avoid a tax increase.
People with high labor incomes are already paying the highest taxes of anyone. It would not be a “rounding error”
But that’s not the main concern, by just lifting the cap, you’d be massively expanding benefits for the wealthiest retirees while doing nothing to reduce the cancerous benefits growth that leads to high taxes for workers and sees retirees consuming ever more and more national income.
A much better fix would be to adopt a flat benefit structure, and index starting benefits solely to CPI, rather than AWI
This would also mean that the businesses employing those people would have their 50% share of that tax also uncapped. Good way to increase unemployment overall
The way to cut benefits is to underestimate inflation for the COLA increase (which honestly they’re already doing), so the checks don’t actually get smaller, they just don’t get bigger fast enough. We’ve known about this for decades. The solution is a little of all of the above: reduce benefits, means test for eligibility, increase payroll tax, raise or remove the cap.
Or we could tax the boomers that have made gains of those not being taxes their entire lives. 5 guys have as much as half the country. Remove the cap and tax them.
Or just get rid of the cap and tax investment dividends the same as you do working income. There are plenty ways to fix this without screwing over people living off social security now. When people pander to the extremely wealthy to screw the poor it always ends badly. God forbid people actually have to pay their fair share.
>Once the workforce is larger than the number of retirees, it'll be a non issue.
It's already bigger than the number of retirees. The problem is that it used to be around 5 workers per retiree, but now it's around 3 and will drop to 2 over the next 30-40 years.
I’d rather drop social security entirely rather than turn into france where a smaller and smaller share of workers is getting screwed more and more for old people to get a check when they had their whole life to save and benefit from explosive growth
Not interested in supporting the boomers anymore. I don’t care if it’s ignorant; society got it wrong.
We should be supporting the youth, the working class, and those who are still actively contributing to society, not mooching off of it. The fact we cover healthcare for geriatrics more than we do for kids and newborns is a completely asinine problem here in America. Robbing the youth to extend the benefits of those 70+ is absolute stupidity.
I've said it before and I'll say it again. Proposing to eliminate the cap on SS tax contributions is a bad faith proposal. First, Social Security benefits have always been indexed to what you pay in. If you eliminate the cap on taxes without eliminating the cap on benefits, you're transforming Social Security from an old-age insurance program to a welfare redistribution system. That is not what Social Security was created to be, unlike SSI, TANF, WIC, EITC, and so forth.
Second, let's take our high tax states like California. The top federal marginal rate is 37% and the top CA rate is 13.3%. That's a combined rate of 50%. If you uncap Social Security, and make it like Medicare which is already uncapped, you're now talking about 15.3%. So a dual income professional couple making $750k who were previously paying 48% in combined taxes are now paying 58%. Do you think that's reasonable or will it discourage work?
People always talk about "the billionaires who don't pay taxes," but EVERY one of these proposals is targeted at the group I call the "W-2 rich." This means that they have high incomes, but they have to work for it every day. If your problem is the capital class, then raise the long-term capital gains rate, which I agree is far too low.
But proposing to eliminate the SS cap is either borne out of ignorance or intellectual dishonesty. There is no third option.
Social Security already is a welfare redistribution program. It’s welfare for the old, paid for by the young. People think that because 1) the taxes that pay for it are listed separately on your return, and 2) the benefits are indexed to your old salary, that it’s some sort of government mandated retirement account. It’s not. It’s welfare for old people.
Now, I tend to agree that merely removing the SS tax cap isn’t the solution here, but people need to realize that Social Security IS welfare. That doesn’t mean it’s bad or that we should get rid of it, but it’s impossible to have an actual conversation about it so long as we’re all pretending that it’s a special account where you “get out what you put in.” It’s not and you don’t.
As an aside, the whole “discourage work” argument is silly. It’s fine to say we shouldn’t raise taxes on that couple making 750k because it’s unfair, but I promise you they aren’t going to quit their jobs or go work as servers to avoid paying more taxes.
I usually hit the ss tax cap sometime in August and it stops being deducted from my pay. I experience it as a minor, but appreciated bump in my takehome pay for the last part of the year.
Same is true for literally ALL of my close colleagues. There is a zero percent chance that any of us would change our working habits if the cap went away. The biggest impact would be feeling bummed out for fifteen minutes when we first get paid in September.
Because billionaires are major lobbyists and people working as doctors, lawyers and engineers aren't. And doctors, lawyers and engineers seem rich to the average person
The cap is raised, to maybe $300k. But so benefits.
But once you hit $300k, the cap is reinstated (commensurate with the benefit cap).
But the cap is eliminated again at, say, $750k. But benefits don’t go up.
As in, the benefits match the cap, up to $300k (or whatever), then no SS is taken out until you earn $750k (or whatever), at which point SS is again paid into, but the payor will not get any SS benefits based on the higher, increased payments.
If we’re going to do that, better to just fund it from general revenues and a higher marginal normal rate. Even if the concept is okay, I think $750k is far too low. Maybe $4 or $5 million
Seeing the world is changing, and the wealthy are more wealthy than ever while literally everyone else is struggling, and expecting the wealthy (who are exploiting society for their benefit) to help finance the society they are extracting from is not stupid or uneducated. Magats, however, are stupid and uneducated.
Especially now with AI potentially taking millions more jobs, we have to acknowledge the world is not the same as it was 60 years ago. To ignore that is ignorant.
Reality in the 60s was very different from today. There was actual competition between companies. Small town America thrived. You could open a grocery store in a small town, employ a few dozen folk with good benefits and still make a living. Today, you can't.
Today a few tech/other (amazon, walmart, uber, grubhub, etc) companies have decimated small town America, and funneled all the money into themselves.
Change is required, whether it's social security, UBI, or something else. Denying that means you are a brainwashed moron who thinks any day now you will be a millionaire.
The fact CA taxes the shit out of its residents is solely a California problem. Nobody else cares.
The real problem is people live and collect SS too long. It wasn’t designed to pay benefits for 30 years especially when the program only requires 10 years of work. The number of quarters required to qualify needs to be raised to 80 and unfortunately the retirement age must go up a bit too. Drop the spousal benefit where people with zero contributions get a free check.
That is because no kind of wealth taxes will generate enough revenue to cover those bills.
That aside. What you are missing is that if you give pensioners more money it does not really matter from whom you that money collect. Because you will be affected anyway. Why? Because that pensioner get that increased pensions and competes over limited amount of real estate, goods and services. So working age people will fund end up funding it regardless.
"One option would be to raise payroll taxes. Social Security is primarily financed through a 12.4% payroll tax on covered earnings, split equally between workers and employers at 6.2% each, up to an annual cap. That taxable maximum will rise to $192,300 in 2027 from $184,500 in 2026, according to the SSA."
Or maybe, just maybe, take the cap off of the SS payroll tax.
"The Social Security tax cap (or taxable The Social Security tax cap (or taxable maximum) is $184,500 for 2026 and rises to $192,300 for 2027. Earnings above these limits are not subject to the 6.2% Social Security payroll tax."
Remove the cap, fix the problem.
After solvency is truly achieved, the 6.2% could even be lowered.
The financial system and the fiat dollar it inhabits are terminally ill. Once a business cycle is dependent on debt to operate, there is a constant need for equity that comes in the form of growth or realistically synthetically generated inflation via federal Reserve. When the aggregate populace is not able or willing to participate in buying “furtherance of credit expansion” the system is defunct. Why we can’t inflate out of our current situation is due to that consumer inadequacy. Assets are only assets because financial institutions are refusing to mark properly in their own self preservation. I know this sucks for the wealthy. It absolutely sucks for the financial industry. It simply comes down to 1 of 2 options.
One -committed austerity. This would lead to the greatest financial crisis in macroeconomic history. Being as over leveraged as we are deflating through the credit cycle would bankrupt nearly every company publicly and private. Critical infrastructure would collapse leaving those in need of emergency care in a bidding war to get a previously institutionalized medical doctor to come out of his or her dwelling to help. The magnitude of this downturn is so violent mainly from too big to fail policies. You take down Amazon and FedEx the collateral damage is eminent. All of these corporations own each other. One big corporate spider web.
Option two-. Debt Jubilee and a return to sound money. Pinning a currency to a basket of commodities to achieve stability and credibility. Accompanied by an obligatory debt wipe. We initially pay off foreign creditors in M1 before monetizing it digitally. Yes I understand what that means for those in financial speculation. The party would be over. We have no other option though. Instead of waiting for something to snap I hope we can make the call sooner than later. Stop thinking about ourselves and let grace have it’s way with us. I know most policy makers are in financial speculation. Investment bankers, central bankers and private equity titans. Please do what is right before it is too late 🙏
How does the workforce increase when half the workers will be unemployed because of AI. Something has to give. The population is declining and people are living longer which means more benefits being paid out. It’s not going to balance out by itself so what is the sensible solution? Unfortunately the people in charge have no answers because they have to take care of wealthy donors and billionaires first so I guess we’re on our own!
Raise the SS cap using the donut hole approach, and tax the SS of the wealthy. SS should go to those that actually need it. It didn’t help that the general budget surplus of 2001 was pissed away by GW Bush’s tax cut, and his going to war in Iraq on a false pretext.
Why on Earth would any Gen Z and Millennial work for 40% less of their money from one year to the next? Congress must want to destroy the place. I propose the following solutions:
The 12.4% OASDI payroll tax (split 6.2% employee / 6.2% employer) is applied to all wage and self-employment income above $250,000, creating a brief "donut hole" between the existing statutory cap and $250,000 that closes automatically as average wages rise over the decade.
Ultra-high-net-worth households derive the majority of their compensation from capital gains, dividends, and passive business income rather than W-2 wages. Amend Internal Revenue Code § 1411 to apply an additional 12.4% dedicated OASDI assessment on Net Investment Income (NII) for single filers earning over $250,000 ($400,000 for joint filers).
The Old-Age and Survivors Insurance (OASI) Trust Fund and the Disability Insurance (DI) Trust Fund are legally merged into a single unified Social Security Trust Fund, ensuring seamless actuarial management.
As someone who makes over the cap, eliminate the cap.
It’s so dumb, suddenly around Oct my paychecks go up because I’m over the cap. All year I budget for less, and then the gov hands me a holiday bonus at the end of the year.
I’ll be fine in retirement, I max out Roth 401k and own my home.
Don’t pity the wealthy.
That being said, part of me dislikes the boomers for voting for tax cuts their entire lives and are now facing the music and wanting a bailout.
My comments keep getting removed for being too short. Mkay, here we go: If we raised the cap, it would be funded. Its really that simple. If we raised the cap, it would be funded. Its really that simple. If we raised the cap, it would be funded. Its really that simple. If we raised the cap, it would be funded. Its really that simple.
Removing the cap maybe covers half. Need to also increase the cap, cap benefits and either reduce benefits for all or increase the overall tax rate. There is no one thing you can do to fix.
All you’re doing is kicking the can down the road. As long as birth rates go down the formula that was made decades ago with increasing population and lower life expectancy won’t work
You don't realize how much money is increasingly sloshing around at all the capped income levels that would suddenly start paying into the system.
Every other western first world nation manages to make this type of system work. Except the US for bullshit reasons like the cap. Do birthrates have an effect? Of course. But these problems are completely manageable when YOU'RE NOT CUTTING YOUR PROGRAM OFF AT THE KNEES LETTING RICH PEOPLE OFF THE HOOK.
I don't disagree with you suggestion, but I would point out that the cost of pension schemes is a massive issue in almost all western countries. The demographics is just fucked.
How about congress stop stealing money from Social Security “trust” fund. Like they have been since at least the Johnson administration. Of course, they could do something really unusual and replace the money! Of course, the leeches in congress will never admit that they stole the money in the first place.
Let it drop the 22%. People invested 50% of the input, now they’re going to get 78% of the output. If we increase payroll taxes, the drop will be much more impactful upon reaching this point again.
Social security is effectively a ponzi scheme where the young subsidies the elderly. It worked when economy and population was growing, but it is unsustainable now. We should have made 401k mandatory with forced employer and employee contributions, and use social security as a top up, rather than make it a guaranteed payment. We should start doing thst now. Maybe even with an option where you get tax breaks in exchange for foregoing your ability to claim it in future.
The last cost of living adjustment I received half of it was to cover the cost in the increase of part A of Medicare cost, all of the rest didn't cover the rise in the price of Part B coverage under Trump in 2019 when the government shoved Advantage Plans down everyone's throats, giving insurance companies a handout. That year the cost of living increase was 2.5%, I figured out I actually lost about 3/4% of my Social Security which didn't rise a bit. They call it a cost of living increase, when it really is an increase to Part A and B. Also all of figure's for Social Security they used in the article were for married couples. My wife who left me 6 years before divorcing me, which put her in the time frame, on her lawyers advice that she could collect half my SS. Because of this the IRS increase the SS tax I paid yearly until I turned 66 by 75% as a penalty for her living out of the country and not paying taxes during that time. Even though I had 48 years paying into Social Security and Medicare although I never had a high paying job as I was a school teacher. After paying Part A and B, I can't afford D or Drug or Dental I receive and live on $757.00 dollars a month. That is the true way SS works. With Medicare I now pay more monthly for health insurance then I have ever paid at any time in my life, even when I was working and paying for my wife's and son's healthcare insurance.
If you people don't like boomers, then you should get out and vote inside of the midterm primaries. But you didn't, so now we have to choose between old people who are out of touch and don't really know what it's like to work right now. They are looking at statistics and telling people that it's the way of life for everybody on both sides.
probably some form of means tested cuts. eg, high pension income reduces current payout up to 22% or so. It would be graduated downward so that the 14% or so that have SS as their only income will not have their benefits reduced. the diff will be made up with a more modest payroll tax increase. plus some 'ubi' like investment fund to help offset the differences for younger people.
Cuts will suck for the marginal folks who's retirement plan was based on the original SS formula. private employees that were fortunate enough to get pension, folks that contributed to their 401k investment accounts for 35+ years, public and private unions will hate it. It will require a QOL change, but the mandatory 22 was gonna do that too.
Dumb ass congress demagogued any attempt at fixing this earlier when it would have been much less painful.
Stop trying to create generational animosity. The obvious answer is to tax the rich. This country has far too much economic disparity. The rich have been getting a free ride for too long. A society that doesn’t take care of its elders needs to adjust its priorities. Figure it out.
If we would tax millionaires and billionaires properly. We would not benun this situation. But it all started with Ragin and his trickel down economics. Well we see how that works. The rich get rich and the people that actually make this country work get poorer. Taxen millennial and Gen Z more is not the answer. We all know the answer but the Republicans and the oligarchs will never let that happen
Remove the social security income cap without raising benefits. Problem solved without having to raise the SS tax rate. Actually make the rich pay their fair share when they're already bigger welfare recipients than everyone else.
The people that get affected by the cap being raised already pay the bulk of all taxes (w2 earners). This doesn’t affect the actual wealthy who do not rely on w2 income.
Gamer_Grease | 3 hours ago
Back in the day you had 100 ditch-diggers for every retiree on social security, so the system worked. Now you’ve got one ditch-digger for every 10 retirees, so the math doesn’t work because that’s not enough wage income for the program to feed off of. But that one ditch-digger now easily does the work of 1,000 ditch-diggers in the old days because he’s got advanced equipment to dig with. In other words, his productivity is much higher.
Tax capital to pay for social security. This is the very obvious fix that nobody wants to talk about because the funders of our political parties won’t tolerate it. But fixing social security to wage income was always going to be a loser after 1971 when wages began falling relative to productivity. Now as the economy grows, wages grow only modestly, and capital grows quickly. Pin social security to capital and we don’t have this issue.
For a while, as we got more productive, it meant an easier life for our old and indigent. But since the early 1970s, all of the extra gains from productivity have been going to shareholders instead of wage-earners, and that’s social security’s problem.
Critical-Werewolf-53 | 2 hours ago
While you’re close. Little off.
When it was first funded there was 5:1 ratio workers paying to drawing. Now we’re down to 2.2 : 1 and it’s only getting worse
So glad they want to tax me more for money I’ll never get to see.
RIP_Soulja_Slim | 2 hours ago
For people that are interested in learning a lot about this, the OASDI Trustee's Report has a pile of information regarding specifically what the issues are and what they're projected to be: https://www.ssa.gov/OACT/TR/2026/tr2026.pdf
From Page 71:
>The effect of the demographic shift on the OASDI cost rates is clear when one considers the projected number of OASDI beneficiaries per 100 covered workers under the three alternatives. Compared to the 2025 level of 38 beneficiaries per 100 covered workers, this ratio is projected to rise to 54 by 2085 under the intermediate assumptions, because the growth in beneficiaries greatly exceeds the growth in workers. This projected ratio under the intermediate assumptions remains relatively stable thereafter, reaching 53 by 2100.
You can rough back of the napkin some of this yourself - the median wage is ~65k, that translates to a total of ~8k of collected SS tax (employer + employee). The median social security benefit is just over 1,900/mo or about 23k/yr. That means with absolutely zero administrative drag you need 2.8 median workers to sustain one median retiree.
Flipped to the context above, that would be a ratio of 35 beneficiaries to ever 100 workers. So we're already beyond that level, we're expected to see retirees hit over 50 per 100 workers, which would mean we'd be collecting (in present dollars) less than 70 cents for every dollar we're paying out of the system.
Demographics are the problem, but congress knew this was a problem decades ago, and rather than making small incremental shifts to build a larger trust fund they sat there doing nothing, so now it's a real big problem.
saladspoons | an hour ago
So we basically just need more immigrants, right?
RIP_Soulja_Slim | an hour ago
I mean, yeah immigration is absolutely a good thing for maintaining labor force demographics, but this mountain is way too tall to climb on immigrants backs alone - taxes on everyone are gonna have to go up. The annual structural deficit here is gonna hit a trillion and a half in present dollars within 20 years.
mrpickles | 18 minutes ago
If you're going to correct someone, at least get it right.
>The original Social Security worker-to-beneficiary ratio was exceptionally high when monthly payments began in 1940, standing at 159.4 workers per beneficiary
tupacsnoducket | 2 hours ago
Man, if only there were some kind of person who was paid like 10,000 ditch diggers but didn’t cap their contribution to 3 ditch diggers share
DarthJDP | an hour ago
If we want to have trillionairs we cant allow productivity to flow to communist ideology like social security!
ants_are_everywhere | an hour ago
Capital is money. What do you mean when you say "tax money"? You have to tax a specific thing.
Botasoda102 | 4 hours ago
I'm on SS, though I still work at 77, but I don't think younger working people -- who are struggling -- should pay more in SS taxes to solve this problem, especially for those receiving benefits now. Congress needs to find another solution.
This issue has been in every SS Trust Fund Report since at least 2010. Obama tried to do something about it, but was even bashed by Democrats.
jeon2595 | 4 hours ago
I remember them talking about it in the ‘80’s. It’s why they raised the retirement age during the Reagan administration.
in4life | 4 hours ago
The tax was also raised in 81, 82, 84 and 88 increasing from a 10.6% total rate to a 12.12% rate in the 80s.
Expect the same. Higher taxes, older age. Maybe means testing and other fun stuff.
Great program….
Worth-Jicama3936 | 4 hours ago
We really should be means testing though. No reason someone making $200k off their retirement accounts should be getting a check for another $40k. If your concern is avoiding elder poverty, there are better ways to do it.
thekidwiththefa | 3 hours ago
Doesn’t it get taxed back anyway? Means testing would just add more administrative costs.
Worth-Jicama3936 | 3 hours ago
It gets phased in taxed. Below $32k it doesn’t get taxes at all, between 32 and 44k it gets taxed at 50% of the income tax rate, and above 44k it’s 85% of the income tax rate.
Yes it would add a little complexity, but not much. You just look at last year’s tax return and automatically adjust it. A computer can do that easily. It would save a lot of money.
The reason means testing adds a lot of complexity for welfare is that welfare means testing is based off of wealth, not income. You report your income (and attest that it is correct) every year to the government. You do not report your wealth, and also wealth can be hard to judge since some assets are illiquid. If you are paid in cash, not goods, then your income is easy to judge.
in4life | 2 hours ago
It was never intended to be another welfare program. Earned Rights vs. Handout, Political Protection from it being a "right," all that. The whole premise of it.
Why would I have a portfolio, at least public, that would disqualify me from getting pennies on the dollar I put in through Social Security anyway? These are smart people. Why not spend it all as you age or throughout your life or at least "spend" it all?
Many ways to work around this and it still doesn't plug the budget gap, which is the same bottom-line issue of raising the cap even if we just assume that smart people are going to play dumb to play along.
akade19961 | 3 hours ago
I just want to say that you sound like a lovely person and thank you for your perspective
thawel | 2 hours ago
Why? Are they going to get more? Would you have thought hat when you were younger?
Botasoda102 | 2 hours ago
I think today's younger workers have serious concerns about whether SS will be there for them. And I don't blame them.
Since, when you cut through all the BS, younger folks are essentially paying my and your SS -- just like I paid for older generations 40+ years ago -- Congress needs to find another solution than raising their taxes. YMMV.
thawel | an hour ago
Much heavier lift for young people today. Less people paying in as others have said and more and more people entering the program.
Botasoda102 | an hour ago
So you agree it calls for another solution?
thawel | an hour ago
I think that means testing and slowly raising the retirement age is the answer. If you have $200k of income or some high number you don't need Social Security, regardless of whether you paid in or not. Is it a social safety net program or is it a program where you just get back what you put in? If it was made to help people not starve in retirement than how can you argue against means testing? The question of whether you should be forced to pay into it is another thing entirely.
Botasoda102 | an hour ago
I’m fine with means testing, as long as if one’s income falls below threshold, SS would pick back up.
The one problem with people opting out, is if they become destitute, we’re not going to let them starve in the streets. So, we’d end up paying some benefits anyway.
Plus, a significant portion of SS taxes is for disability and survivor benefits at a younger age. So, maybe we have to have some tax to avoid those issues.
Many say we should just remove cap, but if we could increase taxes by 12.4 percentage points, a hunk of that needs to go to healthcare, childcare, climate, infrastructure, debt/deficit reduction, housing, jobs, education, etc.
We are in a real pickle right now, hope someone comes up with an answer besides a few tweaks to kick the can down the road for a few years.
whatthepho6 | 3 hours ago
Levy a Social Security tax on all contributions to a PAC. We either see reduced PAC spending or an increase in the social security fund. It's a net positive either way.
jarena009 | 5 hours ago
That's why the priority needs to be a) lift the income cap on social security taxes entirely (alternatively restart it at $300k), b) tax long term capital gains above $1M the same as earned income, and c) gradually raise the payroll tax by 2%, split between employee and employer.
This will not only keep social security solvent but also help rebuild the trust fund as a buffer, plus I'd also suggest doing what some Nordic countries are doing; allowing the fund to be invested in a combination of bonds and stock funds.
PoopWatch | 4 hours ago
This (investment/privatization of social security funds) was proposed by Paul Ryan in some capacity back in the day, but he was buried for it. Also raising the cap kind of supports the point that younger generations have to pay more to support older generations. Demographics are no one’s fault. It’s a tough situation for sure. Nothing will be solved until there’s a crisis.
How_Do_You_Crash | 4 hours ago
raising the cap is more about how the higher income earners should pay more into a system that is a social safety net. We were able to treat it as a 1:1 put money in, get money out, when the population of workers was vastly larger than the old aged and disabled. Not so much now
Throwaload1234 | 4 hours ago
The big problem is that social security was supposed to be an isolated bucket. But in the 70s (I think), the govt allowed themselves to "borrow" from that bucket. Then suddenly it becomes insolvent.
Gamer_Grease | 3 hours ago
The government does not borrow from social security, social security lends to the government. That distinction only makes sense in terms of sovereign finance, but it is critically important.
nostrademons | an hour ago
Yes, the mechanism is that when social security runs in surplus, the SSA buys T-bonds from the U.S. Treasury, and then when it falls into deficit, it sells those T-bonds (or lets them mature) to pull cash back out of the open market.
None of this changes demographic realities. SSA, which ran a $50-100B annual surplus during the 1990s, is projected to run annual deficits in the trillions by the 2030s. That's money that has to come out of the capital markets, which means significantly structurally higher interest rates in the 2030s.
Kernel_Internal | 3 hours ago
I think they always borrowed against it. It remains solvent by 1) the population and therefore people paying in continues to increase, 2) the people paying in continue to make more and therefore pay more. Those are the 2 dials that enable current workers to pay for current retirees. An additional variable is life expectancy/duration of retirement.
In order to help ensure number 2, they have to keep the economy growing, so they historically use inlays over outlays for infrastructure that multiples the economy (interstate highways, power generation, etc). That's a much better use than having the money just sit around. It's like the difference between putting your savings in a brokerage vs a checking account.
Problem at this point is they've been spending multiples of the overages for decades with no real mechanism to reverse it and population growth is trending toward population decline.
Dusty_Coder | 4 hours ago
SS is not a "Safety Net"
Its part of the New Deal.
A Deal was made.
Are we going to honor it, or are we going to disproportionately fuck with a specific generation that is about to draw their first checks after a lifetime of them keeping their end of it?
oldirtyrestaurant | 3 hours ago
Fuck with the generation that has pulled the ladder up, everytime, every opportunity they've had to do so, while they're asking the young to once again sacrifice their own futures for the comfort of the Boomers?
There needs to be a solution that's equitable to all generations. Keep in mind that boomers have been fucking over the young for decades.
plshelpcomputerissad | 3 hours ago
Eh it’s easy to point vaguely at “the boomers” but not every boomer is some MBA who stifled wages and made things suck. The majority of them are just working people like the rest of us. They did in aggregate benefit from a way easier time coming up for sure, I.e. more opportunity, but the actual snickering boardroom villains I imagine when reading your comment are a minority.
If some boomer has spent 50 years just… working as an electrician or whatever and is ready to retire, I don’t think he did much to make my situation worse.
crabby135 | 2 hours ago
You could argue that the electrician did do things to make your situation worse when you look at older generations’ voting demographics.
ShitDollop | an hour ago
If they weren’t able to set aside 10-15 percent of their income in the booming economy they worked in those 50 years….
plshelpcomputerissad | an hour ago
Sure but “wasn’t smart with their earnings” is very different from “actively fucked us over”.
Comfortable_Line_206 | 3 hours ago
A deal was made but the conditions have changed.
It was thought that each generation would be more prosperous to take care of the one before them. That hasn't happened.
And now the wealthiest generation in history that ruined it for future generations is telling them to pay up to support them?
The deal wasn't broken by Gen Z, Gen X or Millennials.
Dusty_Coder | 2 hours ago
The deal isnt broken until you break it.
Which generation are you?
jarena009 | 4 hours ago
I didn't suggest privatizing anything.
TatersTot | 4 hours ago
Investing the Social Security Trust in stocks/index funds/equities aka private companies is equivalent to the boogeyman term of “privatizing social security”
But yeah you’re just describing a sovereign wealth fund which dozens of other countries already have. The genie is also out of the bottle now that Trump bailed out Intel and the U.S. Government owns 10% of it. We should absolutely do it.
Worth-Jicama3936 | 4 hours ago
>allowing the fund to be invested in a combination of bonds and stock funds.
Bush proposed this and dems absolutely blasted him for it. They called it “privatizing social security.”
brainrotbro | 4 hours ago
The cap shouldn't be lifted, it should be removed for social security and medicare. A flat, non-deductible rate on all income.
jarena009 | 4 hours ago
That's what I mean. Remove the cap. Also there's no cap for Medicare payroll taxes, but we should apply it completely to long term capital gains income.
Ok-Sympathy9768 | 47 minutes ago
Raise the cap to 300k?? Not only no.. but heck no! That would absolutely be a terrible idea.
Charming_Accident_66 | 5 hours ago
I hear the “lift the cap” strategy often, but wouldn’t that also raise the max payout for higher earners?
caterham09 | 4 hours ago
You would have to lift the cap on taxes but not lift the cap on withdrawals.
UnleavenedTed | 4 hours ago
Yeah. But, if you make over $300,000 a year and don’t have any retirement savings, you suck at money.
Charming_Accident_66 | 4 hours ago
So a whole new formula. Congress would have to earn their pay!
emp-sup-bry | 4 hours ago
Just remove the cap.
Done.
ellipses1 | 2 hours ago
can you do that without basically passing a new social security bill?
greatuncleglazer | 5 hours ago
Lift cap. Cap payout amount.
Algur | 4 hours ago
No reason we couldn’t add more bend points.
FoolOnDaHill365 | 5 hours ago
No. They lift taxes all the time without it needing to be fair to the end user.
jcooklsu | 4 hours ago
That's not how SS is structured, its a scaled benefit based on your contributions with caps for contributions and benefits, overhauling it into a mask-off income redistribution model isn't some easy button.
Namnagort | 4 hours ago
Why would you pay for something you dont get to use when the whole purpose of paying for it was so that you could use it later?
Momoselfie | 4 hours ago
Welcome to the world of taxation. Why does a person with no kids in school have to pay for property tax that goes to schools? Taxes are to help the community, not directly to the person paying the taxes.
Mr3iron | 4 hours ago
I was looking for this comment!
No kids but I live in a high property tax area.
You’re all welcome!
Ambitious-Divide2951 | 4 hours ago
I'm happily childless, but I am more than happy to help with education! We need smart people.
RegressToTheMean | 4 hours ago
Because I pay for things I don't use all of the time for the public good. For example, I paid property taxes when I didn't have children and a lot of that went to the school system
I sure as fuck don't want to pay billions of dollars for needless wars and to feed the military industrial complex. Yet, here we are. Much of that money would be better spent on internal social programs and safety nets.
Lastly, I'm one of the people who would get hit if we lift the cap. Do it. I don't want to see my fellow citizens starve and be homeless in their old age. Why? Because I'm not a fucking selfish monster
Nick8346 | 4 hours ago
“For public good” & it’s just boomers blowing money at the casino.
37% of social security payments are to people currently making over 100k a year. How about we cut that instead of further raising taxes on the young
RegressToTheMean | 4 hours ago
Did you even read what I wrote before you started frothing at the mouth? I even called out other waste like the DoD which has never passed an audit and to reallocate that money. The DoD waste is far, far worse than what you wrote
Further to this, your percentage is likely wrong because of the tax return limitation. This data you are citing is based exclusively on federal income tax returns. Because low-income seniors whose sole revenue stream is Social Security generally aren't required to file tax returns, a significant portion of low-income beneficiaries are completely omitted from this dataset.
I absolutely stand by what I wrote
Unctuous_Robot | 4 hours ago
The older generations had fantastic economies that they drove into the ground for Gen Z and millennials to struggle in. Anyone without retirement money made a choice. Social security is a Ponzi scheme to keep Gen Z from ever owning a home.
RegressToTheMean | 4 hours ago
You're angry at the wrong set of people. You're better off examining the upward wealth transfer to the oligarchs. Take a look at that and then tell me where the problem is
Also, there are plenty of people who work their ass off their entire life and don't have a lot of retirement assets (or any at all). Further to that, because of private medical care, elderly people go bankrupt as a result. 66% of all bankruptcies are due to medical costs.
Keeping people fed and clothed in their old age is the absolute minimum we should do as a society, especially the wealthiest country in the world
lisabutz | 4 hours ago
Same same, just do it! If Congress could actually implement some policy changes that positively impact labor and retirement we’d all be better off. But I’m quite sure they don’t know what they’re doing…..
FoolOnDaHill365 | 4 hours ago
Welcome to Civics 101.
HolyMoleyGuacamoly | 4 hours ago
well, you don’t have a choice. why would i pay to fund israel or wars abroad when i dont want to?
More_Programmer8905 | 4 hours ago
They still get to use it, just not more of it.
meatyvagin | 4 hours ago
Oh, so you can go onto a military base and just start using everything there?
jarena009 | 5 hours ago
The max is capped if I recall. But we could reduce benefits for the wealthy or do a phase out as part of it
CoastieKid | 4 hours ago
high earners in income aren't the wealthy
CompEng_101 | 4 hours ago
You could do either -(a) lift the cap on taxed income and keep the benefits cap in place, or (b) lift the cap on taxed income and lift the benefits cap as well.
(a) covers about 61% of the shortfall (b) covers about 47%.
[see https://www.crfb.org/socialsecurityreformer/ ]
dogthatwonthunt | 4 hours ago
no they can cap the payout
Hodgkisl | 4 hours ago
>(alternatively restart it at $300k)
This option always makes the least sense to me, it's the option of not taking a side on what social security is, it's playing both that benefits should be proportional to "most" peoples income and the side that it's a redistribution program.
Be convicted on your beliefs, don't try to take a weak middle ground, either it's a program for all based on their contributions or be strong in changing it to a redistribution program.
Open_Pollution_8038 | 4 hours ago
OR we cut benefits and force people who wrote these overly generous benefits into existence to eat their own humble pie.
Less avocado toast and Starbucks, more rice and beans.
UnleavenedTed | 4 hours ago
Exactly!!!!!
akade19961 | 3 hours ago
All of this plus raise retirement age and introduce some means testing plus benefit reductions
mediumunicorn | 31 minutes ago
We already have the AMT and additional Medicare tax. No reason why we shouldn’t the additional SS tax for high earners. Tack it on to households earning $500k+.
Serious-Reception-12 | 4 hours ago
Lifting the payroll cap is a massive tax increase on high earners that disproportionately live in HCOL areas. 300k in California barely gets you a townhouse. It also doesn’t solve the problem. Just kicks the can down the road for the next generation.
We’d be doing the same thing boomers did to us and push the problem onto our children to solve just in time for Millennials to retire.
TatersTot | 4 hours ago
It does solve the problem you’re just against taxes being raised. I don’t understand how raising taxes is kicking the can down the road. If anything it’s the buck stopping with us rather than passing it onto our children.
Raising the social security tax cap also likely means the maximum benefit cap is also raised so those who contribute more will also be able to receive more in benefits.
What alternative solution are you proposing that doesn’t pass this issue onto our children?
Serious-Reception-12 | 4 hours ago
No it doesn’t
https://www.ssa.gov/OACT/solvency/provisions/charts/longdesc/chart2_run416_ld.html
Insolvency would be delayed by ~20 years if we remove the cap, right as elder millennials reach retirement age. This also doesn’t factor in second order effects (reduced economic growth due to higher tax rates).
The only sustainable solution is some combination of broad based tax increases and benefit cuts.
TatersTot | 4 hours ago
It seems like raising the cap or eliminating it entirely will inevitably need to be part of any plan then. I don’t see why it shouldn’t be part of the whole solution along with broad based cuts, allowing the SST to invest in index funds, etc.
It would probably be the most political popular and palatable part of the final bill
Automatic-Channel-32 | 4 hours ago
I'm a high-income earner, and I think it's absolutely ridiculous that there is a cap that should continue throughout the year
jarena009 | 4 hours ago
It actually solves nearly 80% of the problem and doesn't kick anything down the road.
Sorry if you're making $300k as an individual, you're pretty well off lol, and the tax increase would be on income over $300k. We're not rearranging an entire solvency plan around a few $300k earners in SF who say they can't get a townhouse.
Serious-Reception-12 | 4 hours ago
It kicks the can down the road 20 years for the next generation to deal with, just like boomers have done to the rest of us today.
wailferret | 4 hours ago
$300K in VHCOL areas is not well off when condos cost $1.4M, and other expenses are also extremely expensive
Allw8tislightw8t | 2 hours ago
What a shit show. If only we could have seen this coming.
That’s right we did see this coming since around 1988 and the boomers decided to kick the can down the road until they retired.
Cut the benefits.
Mnm0602 | 5 hours ago
I feel like once the very last boomer retires there will be all kinds of pressure to remove the FICA cap.
Hey I’m all for it if you plan to ramp up my payments accordingly when I draw down. Though realistically I plan as if I’m not getting a dime.
in4life | 2 hours ago
Future you will thank past you for that plan.
braxtel | 4 hours ago
We are also going to have to figure out a way to make AI workers (or rather their owners) pay taxes for Social Security to compensate for replaced workers' taxes.
Gamer_Grease | 3 hours ago
You do this by taxing capital gains and/or wealth and having the money go to social security. Productivity gains have largely flowed to capital since the 1970s, which is why SS is in jeopardy, because it gets all its money from wages. Having it draw from both capital and wages would pin it to the overall economy’s growth, which would mean that AI’s contributions to productivity would benefit SS instead of hurting it.
RIP_Soulja_Slim | 3 hours ago
> Productivity gains have largely flowed to capital since the 1970s, which is why SS is in jeopardy,
The whole productivity/wages/capital discussion is a lot more nuanced and complex than this - for instance if you index wages to PPI or the GDP deflator rather than CPI the gap closes considerably - because CPI tends to run hot vs other measures of inflation, it also creates a gap here due to the data measurement.
But the thing I really wanted to comment on was that this has nothing to do with SS's issues, the reason why SS is in trouble is 100% because of demographics. The population is aging, we didn't put enough money in there to pre-fund it across time, now that the population has aged the payouts are increasing like nuts and the amount of workers to support this just doesn't exist.
arstin | 3 hours ago
Right now all of that savings is profit, which means this would effectively be a new tax on shareholders. And there is zero chance of that happening in the U.S. So buckle up Americans, the ride is just getting started.
dust4ngel | an hour ago
> We are also going to have to figure out a way to make AI workers (or rather their owners) pay taxes for Social Security to compensate for replaced workers' taxes
this actually solves itself - since you need 40 quarters to qualify for social security, all the people with no jobs won't qualify for benefits.
bob: we fixed the glitch.
braxtel | an hour ago
So it'll just work itself out naturally.
No-Permit-9331 | 3 hours ago
That is where slavery comes into play!
DeltaForceFish | 5 hours ago
The problem is the government spent the money and its funded by what is coming in through future generations. Canada’s version invested a pool in the market and actuaries have managed it out to 2100 with no concerns of payments.
Algur | 5 hours ago
SS receipts in excess of expenditures are required by law to be invested in special treasury bills. This has been true since inception and is fundamentally the same as an individual investing in a government bond.
u60cf28 | 5 hours ago
By law, the Social Security trust fund can only be invested into US Treasuries.
As the other commenter noted, Bush wanted to let a portion of it be invested in the market, but Democrats whipped up a fear frenzy amongst seniors and stopped it.
I’m very much a partisan Democrat and liberal but Bush was right and the Dems were stupid here.
ApplicationCalm649 | 4 hours ago
Didn't Bush make it about private accounts, too, though? There's a difference between investing the common pool in the market and giving the wealthy yet another tax free investment vehicle.
take_five | 4 hours ago
easy to say that at the end of a generational bull run though. Don't think people would have been very happy about it in 2008 to 2012.
Check_Me_Out-Boss | 4 hours ago
People drawing benefits wouldn't have felt that change, though, and the fund would have received greater benefit since then.
It's not like the fund was broke at that point.
angrysquirrel777 | 4 hours ago
You sound like someone who pulls their money out at a recession
badluser | 3 hours ago
Old people do, because they are old and need stuff.
Loop_Within_A_Loop | 3 hours ago
easy to say at 35, harder to say at 65
slo1111 | 4 hours ago
I wish more left of center understood this. I am very much in your camp.
Silly thing about the opposition at the time was that they fear mongered that everyone would lose their retirement in stocks. Obviously they could have regulated what the accounts could invest in, so it was just fear mongering
Algur | 4 hours ago
And we didn’t have to invest 100% in the market. Keep a portion in treasuries to hedge economic downturn and a portion in stocks to hedge inflation.
AfterCommodus | 3 hours ago
What would have happened to seniors in ‘08? You can regulate what it could be placed in, but if the entire market goes down…
slo1111 | 3 hours ago
Bonds went up because rates went down in the great recession.
It is all about what risk levels would be tolerated for investment. Individual stocks would be a great way for people to lose $n thus should probably not be allowed.
Plus government often steps in during times of emergency, like they do when extending unemployment benefits during recessions.
I would probably recommend to include in such a law that any investment allowable in the accounts has to meet certain criteria such as investment mixes based upon age, etc.
Put a tax on distributions to pay for the emergency contingency funding
manliness-dot-space | 5 hours ago
Yeah George Bush tried to do that like 20 years ago and Democrats wouldn't let it happen
JRoc1X | 4 hours ago
Also hurricane Katrina happened at the time and the news was covering that 24 7 so puplic barley heard about Bush proposal to change social security
Dm_Glacial_Gatorade | 4 hours ago
Why did social security become invented? It was a response to the consequences of the Great Depression and the stock market crash. Social security is meant as security, not an investment.
slo1111 | 4 hours ago
Passive investment is a better vehicle than taxes on labor because it is always rightsized for the demographics versus being victim to it as we are with the boomer bubble
Unkechaug | 3 hours ago
You're wasting your time. People are doomed to repeat the same stupid mistakes from history and never learn from them.
WantCookiesNow | 4 hours ago
What was democrats’ reasoning at the time, do you remember?
CompEng_101 | 4 hours ago
There were a lot of technical arguments (implementation, admin issues, what investments you could choose), but I think the main ones were:
- Risk: It transfers risk to individual retirees. Instead of a 'guaranteed' return, it could mean that if the markets did poorly or you retired during a market downturn you would get less.
- It wouldn't actually solve the SS solvency issue and would require a lot of government borrowing to fill the gap left by funds being diverted to private investments. I think the low-end estimate was $750B in additional borrowing (back when that was a lot of money).
It wasn't just Democrats who resisted (though they lead the charge). AARP also pushed back and the Republicans in congress weren't particularly excited by it, so it never actually got to a vote.
SMELLSLIKEBUTTJUICE | 4 hours ago
Market volatility.
rhino369 | 4 hours ago
Basically, "don't gamble social security in the stock market." The DotCom bubble was still very recent so that was an effective attack.
But the S&P 9X'd since then and it would have worked out great.
prosocialbehavior | 4 hours ago
Yep. Also even 401ks were kinda relatively new thing and Jack Bogle had just started preaching about index funds in the late 1990s. I think a similar reform could be passed nowadays if the Democrats pushed it.
I didn't like Bush as a president but he was ahead of his time on this reform.
IrateBarnacle | 4 hours ago
It would have allowed some of the funds to be privatized and put in the stock market IIRC
prosocialbehavior | 4 hours ago
increased risk if partially privatized, unfortunately that worked out great for all of the countries that did it.
dogthatwonthunt | 3 hours ago
The fact taxes would need to be raised to do it
Woodit | 5 hours ago
This will probably be downvoted but I do remember that and the discourse at the time
SmallSadSmile | 4 hours ago
My concern at the time was based on a distrust in our government to avoid corruption and not have money subject to partisan bickering. What stops Trump from forcing the SSA to spend $2 trillion dollars acquiring a minor interest in Trump, Inc.?
MakeMoneyNotWar | 4 hours ago
That’s a problem every sovereign wealth fund faces, which is what if whoever is in power could corrupt it and have it invest in whatever that person in power wanted.
There could be guardrails, such similar to the federal reserve, or what the Norwegian sovereign wealth fund does to protect its independence.
in4life | 4 hours ago
They’ve done well with the Trump accounts.
manliness-dot-space | 5 hours ago
The first rule of politics is courting the fresh meat because they aren't alive to remember the mistakes your party made, and the lies and hypocrisy and corruption
Dm_Glacial_Gatorade | 4 hours ago
We are living in the most corrupt administration in history. Just look at how oil futures are traded 15 minutes before Trump tweets or how much is traded before a random tariff is applied.
manliness-dot-space | an hour ago
Well, you any "unvote" once they are in office, you can only vote in future elections
Brickman_monocle | 4 hours ago
The republicans controlled both chambers of congress in 2005, and his plan never went before congress?
prosocialbehavior | 4 hours ago
It would have needed 60 votes in the Senate and Democrats uniformly opposed it. They actually did good job of scaring the public about it and Bush dropped it from his second term push because of the poor public opinion it started to get.
https://www.brookings.edu/articles/why-the-2005-social-security-initiative-failed-and-what-it-means-for-the-future/
Unctuous_Robot | 4 hours ago
2008
food-dood | 4 hours ago
Are we just going to leave out that this was for personal accounts, which would have thus reimbursed the trust fund less?
prosocialbehavior | 5 hours ago
Yep social security would be in a much better financial situation if we took the Bush reform back in the day.
Technically, the market could have been horrible and this may have not been the case. But gotta give W. the W with this one.
wyocrz | 5 hours ago
I thought W was on the right track but......can't let the other side get credit for anything.
SmallSadSmile | 4 hours ago
Alternative Universe Headline: Social Security Defunct after SSA Forced to Spend All Money Acquiring Trump Inc.; Trump Inc. defunct.
phoenix823 | 2 hours ago
The alternative would have the American government be a substantial shareholder in all publicly traded companies in the United States. Now I don’t have a problem with that but there’s a certain political party that up until a year or two ago would have an absolute stroke for suggesting something like that.
SirOutrageous1027 | 3 hours ago
The problem is that all the commonly suggested solutions have some pretty hard down sides. There's no good solution.
Want to raise SS taxes? Great, you've just put the largest tax increase on the lowest income levels in decades. Even 2% ends up hitting every wage earner. People won't be happy, voters will turn on whoever does it.
Want to raise the cap? Then you put a big tax increase on upper middle class wage earners - not the wealthy millionaires. The marginal rate jumps from 24 to 32 just past the SS cap. The government takes that 6% (and then some) and throws it into the general revenue fund instead. That's also about where additional Medicare tax kicks in. You're smacking doctors, lawyers, engineers, and other high income wage earners with nearly a 50% marginal tax rate. The millionaires won't be affected. It's a shitty solution, but likely would pass because it doesn't piss off the bulk of voters, and only hits people not rich enough to lobby against it.
Cut benefits? You might be vastly overestimating just how much social security pays out. The average social security check for retirees is $2000 per month. If you have the max number of working years (35 years) with maximum contributions and wait until 70, you'll get like $5000 per month. This is also political suicide.
Means test? This ends up hitting those who probably are maxing out their social security and getting that $5k per month. What it means is you have people who will have paid into the system but won't benefit from it, which at some point is pulling the rug out from people. It's probably the least shitty solution though. The high income retirees won't miss it that much. Some retirees on the cusp of whatever those brackets end up being probably start creative accounting though.
Raise the retirement age? Frankly we already have a problem where older people are hanging on in the work force and younger workers are having a harder time being promoted, which also cuts off entry level jobs. We lowered the retirement age with reduced benefits to actually encourage people to get out and reduce benefits overall. Which is why you take a big hit retiring at 62 instead of 70 (it's over a 50% reduction).
Flatfooting | an hour ago
Folks just need to start drinking and smoking again and die at a reasonable age. People who die before they retire are civic heros.
MrGulio | an hour ago
Waaayyyyy ahead of you boss
AdUpstairs7106 | 24 minutes ago
How about making lane splitting legal for motorcycles. It will eliminate a lot of future social security recipients and as long as there is not an accident will speed up our traffic logged roads.
Xyzzydude | 10 minutes ago
The only upside of Covid
anarcurt | an hour ago
Regular taxes have to go up too. A two trillion a year deficit in "good" times is unmanageable and grossly irresponsible.
DredPRoberts | an hour ago
>deficit in "good" times is unmanageable
Just wait until the bill for the latest forever war comes due.
AdUpstairs7106 | 23 minutes ago
What if Iran pays for it for putting their nation so close to a lot of our military bases?
Academic-Ball-9606 | 26 minutes ago
Cut the military budget by 75%. The military spends billions to shown up by $50k drones
Ketaskooter | 3 hours ago
You left out a lesser talked about solution, tax corporations with a subtraction method VAT tax. IMO all welfare funding and most government funding needs to be moved off a labor tax as fast as possible. The technology is threatening to spike unemployment which will collapse the tax revenues.
madogvelkor | 2 hours ago
They'll just raise prices and then voters will be mad about inflation .
AssCrackBanditHunter | an hour ago
It's pretty much without a doubt that whoever ends up having to make the tough calls and actually make a decision (Democrats) will lose the following election because Americans hate taking their medicine.
dust4ngel | an hour ago
let's see how raising prices when the bottom 90% has disposable income plays out.
Ketaskooter | an hour ago
It would depend and overall should be price neutral but it would be a messy transition. Labor intensive businesses would get a tax reduction while labor light businesses would get an overall tax increase.
penty | 39 minutes ago
Right, labor and production are decoupling. Taxes are going to have to adjust.. much to the whining and complaining of the excessive haves.
cjgozdor | 2 hours ago
The solution is simple: punish the people most responsible for the shortage.
The recipients have had 60 years to vote to fund their own social security. Asking somebody else to fund it is an outrageous ask
DevilsAdvocate77 | 2 hours ago
Anyone with a "simple" solution to a complex problem usually has no idea what they're talking about.
Especially when the solution is essentially "hurt the right people".
SirOutrageous1027 | an hour ago
Social Security has always been a program where the younger population is paying for the older population.
And for what it's worth, boomers did vote for politicians who made a lot of adjustments to Social Security. In 1977 they adjusted the COLA increase (creating the notch babies who got screwed), then increased the payroll tax for in the early 80s, raised retirement age from 62 to 67, and then raised it to 70 in 2008. The 2000 election had a big debate between Gore's lockbox and Bush's "investment" (aka privitization) plans. It's really been the last 20 years, as boomers have been collecting social security that the government has been afraid to touch it.
While I'll happily blame a lot of the world's problems on the boomers, it's not fair to say they did nothing to try and fix this situation for 60 years and now want young workers to bail out social security.
theuncut4u | 48 minutes ago
huh? retirement age is 67. https://www.ssa.gov/benefits/retirement/planner/agereduction.html. 70 is when you stop earning DRCs.
a_library_socialist | 4 minutes ago
The payroll tax increase was in the context of Reagan's massive tax cuts - it was basically Ronnie and Greenspan making a major change to more regressive taxation is all.
The Boomers entire time as political leaders has seen massive deficits and debt, usually in giving either tax cuts or benefits to themselves. And that means that the "trust fund" exists as a debt competing with a massive US debt that we're currently see spiraling out of control at all.
Boomers' have always been determined to throw this shit pile onto the young - it's why the benefits will be cut in the future, when most of them will be dead, instead of now.
BeerandSandals | 2 hours ago
Yeah that’s how the voting booth works, you walk in and there’s a button that says “fund SS” or “don’t fund SS”.
GiraffesRBro94 | an hour ago
We literally don’t get that button, we get to select between two geriatrics who are beholden to corporate interests more than their constituents. And in many cases our vote has less impact than someone in another area simply because of where we live
Wrenchinspokesby | 2 hours ago
Expanding the tax base makes the most sense to me.
Start with the ECT proposal. Extend the employer portion to cover all employee compensation expenses.
SuccotashOther277 | an hour ago
Tax AI agents
impulse_post | 2 hours ago
What about a progressive tax on capital?
Vegetable-Seaweed591 | an hour ago
Honest question - why not tie social security reimbursements to total wealth (including retirement savings)? If you're worth 7 digits, receive a pension, and have multiple houses, not sure why you should receive the full Social Security benefit.
Infamous_Crow8524 | 32 minutes ago
So two people work 45 years, same job, same income.
One lives an extremely frugal lifestyle, drives a beater, shops at Goodwill, packs his lunch, takes staycations, etc., and invest in a couple rental properties, funds his 401(k) with the savings.
The other, spends everything on maximizing their lifestyle, gambling, drugs, etc..
Which one should be rewarded?
lester537 | 28 minutes ago
Yep, great points.
naijaboiler | 9 minutes ago
Neither. Both of them voted were part of a group that voted to underfund government t and start stupid wars for 40 years. Some of that gains the frugal one has gotten is from the underpaid taxes and the way government has been systematically advantaged to favor capital ownership over labor. So yeah, they both take a haircut
over_here_over_there | 8 minutes ago
Both. It’s not up to government to judge your lifestyle.
Greystacos | 53 minutes ago
BCUZ I PAID IN TO IT IM OWED IT BACK or some bullshit like that
ROIDie777 | 41 minutes ago
Yeah and I pay into lots of services I’ll never use. It’s a package deal.
Loose_Recover_4118 | 23 minutes ago
Except you were told you’re getting a return on these payments
AnestheticAle | 38 minutes ago
That was the deal. It’s a shit investment we’re forced into and I’d like to see some return.
naijaboiler | 11 minutes ago
I am happy to return your funds with 8% interest rate. Get off Medicare and social security. Good lucky buying healthcare at your age. Unless you die young, most elderly are still getting out more than they put in even after account for returns
naijaboiler | 12 minutes ago
We will refund you your amount . Get off social security and Medicare!!! We will even return it at 8% annual interest rate. Take your money and go buy insurance at a rates for elderly
a_library_socialist | 8 minutes ago
Because means testing makes it easy to cut.
Just tax the people more than they get.
AdagioAggressive5756 | 7 minutes ago
I think the easiest thing is to tax all W2 income and not just the first 184,500.00. By the time many people reach the ceiling they are already used to it coming out of their checks, so just keep going all the way up to where a person's income tops out. Medicare already taxes all income and the percentage goes up a little once you reach a certain point. Might as well do it with SS as well.
vt2022cam | 3 hours ago
They could just lift the cap. Not that difficult of a solution that would only impact the upper 1% of income earners, who have also benefitted disproportionately from mass tax cuts over the last 30 years.
SirOutrageous1027 | 2 hours ago
Lifting the cap hits wage earners, not millionaires. That's aiming a 6% tax increase on wages already being hit between the 32% and 37% bracket. The people who end up paying it are basically the people who are upper class. It's the people in that $200k to $600k range who end up taking the brunt of it. The group too rich for tax cuts, too poor for tax loopholes, and don't donate enough to keep Congress off their back. It hits a section of the population that's small enough that politicians can get away with it.
Allw8tislightw8t | 2 hours ago
I don’t think it’s enough people in that 200K to 600k group to really cover the costs
And if you are staring down a close to 50% effective tax rate (federal, state, local, SSI, Medicaid/medicare) and still having to pay for your own healthcare, it’s time to look at moving to another country
SirOutrageous1027 | an hour ago
No, but it would kick the can down the road a little more. It's a shortsighted band-aid that only really screws over a small group of voters so there's a chance Congress might actually do it.
Comfortable-Brick271 | an hour ago
Are we really sitting here crying for people who earn half a million a year?
SituationTurbulent90 | 2 hours ago
Right. I dont want to pay another 7k in tax just so fucking boomers can ride off into the sunset scott-free. If I'm going to be required to pay more in taxes, I want to see either a benefit cut, a means test, or both implemented too, because i dont doubt for one second that's what's waiting for me when it's finally my time to retire. They need some fucking skin in this game too.
traptasticone | 2 hours ago
They don’t want your facts. They just want to hear that someone else will pay for it.
SirOutrageous1027 | an hour ago
Frankly that's what I expect will actually happen. Just like Medicare hasn't been funded for years and they just allocate budget for it. The same thing will happen to Social Security and it'll just increase deficit spending, at which point we better hope the MMT guys are right about debt.
Mr-Logic101 | 40 minutes ago
I am actually OK with this. Let’s do it.
Grantmepm | 38 minutes ago
And they likely dont have movable business capital to change tax jurisdiction immediately. They are likely employees with a lot of skill capital that wouldnt pay that well in most other countries worth moving to.
Loose_Recover_4118 | 17 minutes ago
Yeah, just tax upper middle class families in HCOL areas an additional 12% so people who live in lower cost of living areas can be subsidized even more. Completely fair to everyone
greenroom628 | an hour ago
There's one more suggestion that will create complaints from the xenophobic party -- increase immigration of skilled workers.
This is an almost immediate increase in the paying base for SS. Particularly with higher paying, skilled labor, and professionals. Attaching a green card and citizenship pathway to any foreign born student graduating with a technical or scientific degree will practically guarantee more input into the SS system.
AnestheticAle | 26 minutes ago
Or will companies use them as cheaper alternative labor?
AdagioAggressive5756 | 5 minutes ago
But you would be making a shortage of jobs for US citizens that are just as smart and skilled as immigrants. I am all for it as long as US citizens are used first.
madogvelkor | 2 hours ago
Cutting benefits also means more pressure on working taxpayers as they now have to directly support elderly relatives who will not be able to afford to live independently. Or more elderly people qualify for low income benefits at the state level shifting costs to states.
Ok_Detective_9418 | 2 hours ago
Just raise the working years required slowly from 10-20. That should fix it
SirOutrageous1027 | 2 hours ago
I addressed that one. The problem is old people not leaving the work force. We're already seeing issues with boomers not retiring keeping younger workers stuck in mid level and entry level jobs and lack of opportunities for promotion and hiring.
Right now, you can retire at 62 and take a hefty reduced benefit, or wait until 70 to get the max benefit. What's more likely is stretching that to 75 for the max benefit. Lowering the retirement age for reduced benefits actually saves the program money. If you retire at 70, it takes about 10 years to make up what you would have brought in if you retired at 62. Only 8% of social security recipients wait until they're 70. So basically for 92% of the people over 80, the government is saving up to 30% on what they'd otherwise be paying because those people took social security early. And that actually puts it in line with life expectancy, half the senior population doesn't live beyond 80, and the half that do are mostly being paid at a discount.
If you really wanted to troll gullible people, they'd lower social security even younger for an even greater reduced benefit.
Ok_Detective_9418 | an hour ago
Average age someone has a life changing medical issue is mid 60’s. Best believe I’m taking SS at 62 if I still can then.
mediumunicorn | an hour ago
Same. I hope to have retired before 62 as it is, but I intended to take my benefit as soon as I’m eligible.
LikesPez | an hour ago
I’m staying on private insurance for as long as I can.
SirOutrageous1027 | 21 minutes ago
It's really about betting whether you're in the 50% of people who live past 80 or not. That's basically genetics, look at your family, look at your health, and place your bet.
If you don't actually need the money, then there's an argument to take it at 62, invest it, and try to beat an 8% yearly return and you'll beat out waiting until 70. But if you're needing that money to live you can't do that.
thepinkdread2026 | 42 minutes ago
Exactly this is something that a lot of folks don’t seem to understand. I know someone who is in their mid 30s has been with the company about 8yrs and they outsource a key finance task to a 90 year old man who is retired and has a pension and has everything, but for some reason their CEO hangs on to this person and doesn’t bring this task in house which would be the best for everyone. This man has almost died a couple of times right on their reporting deadlines and those have been my friend’s only chances to shine. He’s a good guy but damn retire man go sit in a recliner or something for a little bit it’s like what do you need all this money for? It’s not like he doesn’t have good healthcare he was a former wall street guy.
AdagioAggressive5756 | 2 minutes ago
Throw in Medicare at 62 and cover younger spouses and you would see many retire. The 70 year old with a 60 year old wife still has to provide insurance in many cases.
Persistent_Parkie | an hour ago
That will only help so much, plenty of people do not have the capability to keep working much longer. My mom got dementia at 65, I have a friend who got rumetoid arthritis at 64, etc.
It might help some but you need to be aware a whole bunch of those people you expect to save money on by not giving them retirement social security will instead end up on social security disability.
mediumunicorn | an hour ago
Most people work 20 years minimum anyway, right? Like I got 8 SS credits from working in high school for two years. 10, or even 20, years of credits is quite easy to get. I can’t see this affecting anything.
ROIDie777 | 36 minutes ago
It affects all the stay at home wives who get a job once the kids leave the roost and are in their late 40’s early 50’s when they enter.
Ok_Detective_9418 | 25 minutes ago
You cut out all the people who work in the black market economy during their prime years then get a job from 52-62 for their check. If they have to participate 20 years it will help everyone because you only need a job that pays 2k a month for 10 years to get get 2k for life rn. The math doesn’t math.
BilbaoBoggins | 2 hours ago
The obvious solution is a wealth tax and taxes on AI etc.
BobaLives01925 | 2 hours ago
Good rundown. Would like to a combo of all of these avoid hitting anyone too hard.
SuccotashOther277 | an hour ago
Means testing would politicize it under the bucket of “welfare” and lose bipartisan support . Granting everyone access to a program is the best way to keep it popular
lion7725 | an hour ago
George W bush was right. Should have moved to 401k like individual accounts, with both employer and employee contributions mandatory.
Probably still is the best move, but a lot more complicated now when the system is already in peril and facing imminent doom
Test-NetConnection | 39 minutes ago
How about applying the ss tax to capital gains AND removing the cap? Then close tax loopholes like taking loans out against investment portfolios to avoid ever realizing gains. Finally, take SS from everyone with more than $1mil annual income or $5mil in assets.
Chopped_Liver228 | 20 minutes ago
No. The simple and effective solution is to remove the cap so that wealthy people continue to pay into the system after they pass the current, ridiculous threshold of $184,000. Those who benefit from that low threshold can easily afford to kick in the same % of their income as the rest of us do.
But then, maybe you are just a feudalist.
PissTapeisReal | 15 minutes ago
Means testing SS will kill its public support even if a small percent are impacted. People in this country love to pretend like one day they will be rich and these policies will affect them when there is nearly a 0% chance that will ever happen
bfeils | 9 minutes ago
Have you heard about the donut method? You return the full tax at a particular income level rather than uncapping in totality. Affordability is also at play here. None of this matters if cost of living continues growing at rates well above pay/benefits.
The solution is likely a mix of things - raising revenue via the donut method and a percent or two increase (and ensuring the contribution continues to be split evenly across employer and employee), some mechanism for cost reduction, and some level of either benefits adjustment or alternative funding mechanism.
And it's pretty counterproductive to say "we've tried nothing and are all out of ideas!". You're right that there's no perfect solution, though every day we wait to fix it the gap to solve grows.
Xyzzydude | 4 minutes ago
Another unspoken drawback to significantly increasing SS taxes is that there is only so much political will and tolerance for hefty tax increases.
You want to spend it on this instead of increasing say, health care, eduction, child care, etc? Those are all heavy lifts already, doing them after a massive SS tax increase would be pretty much impossible.
Wrenchinspokesby | 3 hours ago
If we’re going to abandon the idea that SS is an “earned benefit” w Reddit’s favorite solution (eliminate the cap w no additional benefits)…I see no reason why this should just be funded by a payroll tax.
If we’re going mask off that this is a welfare program for seniors - it should be funded by all types of income.
Putting ever more burden on wage income when wages are a downward sloping % of GDP since the 60s is not sustainable.
Little_Wonder8818 | an hour ago
It is a defined benefit plan in substance and structure though. If it was a welfare program we would see traits of that: it would not be an entitlement, the benefit amount wouldn't be tied to past income, and the cost would be a lot lower for those reason.
It only smells like a welfare program based on the state of people's finances and the amount of the typical benefit. They depend on it. But just because you depend on a benefit does not make it welfare.
Wrenchinspokesby | 28 minutes ago
My point is if you eliminate the cap on contributions without giving benefit credit for the earnings, as is favored by many, it can no longer even remotely be considered a defined benefit plan
No-Permit-9331 | 4 hours ago
Well that “fix” should definitely make younger people want older people dead! How about TAXING THE ELITES!!! How about that? God Damn this country is so fucked!!
BornAgainBlue | 4 hours ago
For your daily generational warfare spark tune in here....
Don't worry kids. They've always done this bullshit. If they can't convince us that the other colored person is the problem, they will try to convince us that the age difference is the problem. Meanwhile, the rich people just run off with your money.
PSIwind | 4 hours ago
The rich people are on average the older generation. The two are intertwined
Infinite_Dress_3312 | 3 hours ago
of course older people have more money on average, theyve been in the workforce 20-40 years, and have had time to accumulate assets. that dosent mean they are the 1% class who is currently grifting and robbing our country blind.
SnowDucks1985 | 3 hours ago
The boomers are the rich people though? They hold the overwhelming majority of the wealth as well
as government power, why wouldn’t the age be relevant?
coriolisFX | 3 hours ago
The boomers are the rich people, and they're trying to raise taxes on young people.
Konukaame | 4 hours ago
If we had done even basic fixes a decade or two ago, Social Security could have easily been kept solvent.
By waiting until it's an imminent crisis, only drastic changes can even hope to make a big enough impact, and they'll be so hard to swallow that the backlash and the crisis can be used to further sabotage the program and any effort to maintain it.
Same goes for basically every other looming crisis we face.
ChemicalDebate314 | an hour ago
Benefits need to be cut for current retirees for me to support tax increases on current workers
Konukaame | an hour ago
>and the crisis can be used to further sabotage the program and any effort to maintain it.
Called it.
IKillZombies4Cash | 4 hours ago
If anyone would like to read about this, heres the CBO release
https://www.cbo.gov/publication/59340
(character count wawayaybubuhahwoohoo)
nurse_brett | 4 hours ago
No one's going to do anything about it. We're seeing in France today some of what it'll look like if they try to do anything about it. We'll keep letting everyone have everything and then one day no one will have anything. Or something like that. I don't know, my coffee hasn't kicked in yet.
octopus-opinion987 | 4 hours ago
Redditors being redditors.
There is serious analysis and proposals on this that congress wont look at. Talk to them.
Eliminating the cap gets you far, but not all the way.
Currently workers pay 6% and employers 6%.
Raise it a little each year, in combination with lifting the cap, and hold your geriatric congress folk accountable for passing the law now instead of in 2033.
Don’t raise the age. People cant find good paying jobs after 62 and get targeted for layoffs.
Loop_Within_A_Loop | 3 hours ago
i mean, none of this wrong, but it seems very unfair to raise taxes and not cut benefits
it’s a tough question because unilateral cuts would put a lot of seniors on the streets, but without some level of means testing of benefits, we’re not fixing social security, we’re fucking over the young so the old can collect
AccomplishedBake8351 | an hour ago
It’s not wrong to not cut benefits so long as the benefits don’t get cut down the line.
mwjtitans | an hour ago
I remember being told something about bootstraps.
Looks like the gravy train is over, raise the age or shake down the billionaire money tree for your social security
NotAShittyMod | 4 hours ago
> Don’t raise the age.
Absolutely raise the age. The average life expectancy in the US in 1935, when Social Security began, was 61.7. The average life expectancy today is 79. If we’re inflation adjusting benefits and raising contributions we should be raising the pensioner age as well.
ceciledian | 4 hours ago
We may be living longer but not living well. People who work physical labor all their lives often can’t work past 62.
AccomplishedBake8351 | an hour ago
Well they’re the same ones telling everyone else to figure it out. Joe the plumber can become Joe the Walmart cashier from 62-67
blakmechajesus | 4 hours ago
Just because people live longer doesn’t mean they can work longer. The age is what it is because that’s when people start to suffer from age related disabilities that make them less productive. That has not changed
Nikoladge | 3 hours ago
The life expectancy was lower in large part due to higher infant mortality
reasonably_plausible | 2 hours ago
>The average life expectancy in the US in 1935, when Social Security began, was 61.7.
But life expectancy at age of retirement was much closer to what it is currently. Life expectancy for those who made it to 65 hasn't grown by nearly than much and we've already raised the age of full retirement by two years to adjust for that.
Rough-Board1218 | 4 hours ago
Why is no one proposing means testing benefits? Currently over $200 billion per year in Ss benefits go to millionaires. The average recipient is much wealthier than the average payer. It's a deeply immoral system
Everyone here is saying young poor people should have to pay EVEN MORE so that old rich people can continue to receive money they don't need. It's beyond ridiculous. And yes, keep down voting without replying, because you know I'm absolutely right
Disastrous-Wonder153 | 2 hours ago
While many people view Social Security as a universal insurance program where "you get out what you put in," it is effectively means-tested through three distinct hidden mechanisms: a highly progressive benefit formula, the taxation of benefits for moderate-to-high earners, and strict pre-retirement earnings penalties.
Dusty_Coder | 3 hours ago
Its not so they can continue collecting
Its so the next generation has its chance to collect anything at all after paying in for 40+ years.
You are not "sticking it to the boomers" you are fucking over GenX
Rough-Board1218 | 3 hours ago
Means testing isn't sticking it to anyone. It's stopping benefits from going to people who don't need them. Did you even read what I wrote?
DarkRider23 | 3 hours ago
You’re sticking it to those people… you’re actively punishing a group that decided to save money and grow their retirement accounts over time. If you’re going to means test it then let me opt the fuck out completely.
Social security was established as an earned benefit. Now you’re flipping it on its head and saying because you don’t want to tax rich people more and lift caps it shouldn’t be an earned benefit but a means based benefit.
Rough-Board1218 | 2 hours ago
> flipping it on its head because you don't want to tax rich people more
Taxing rich people is functionally the same as reducing their benefits. Sure, we could tax all rich people receiving social security to obscure the fact that it would be a benefit reduction, so that their feelings might be hurt less. Thats one way.
Fun fact, Social security taxes are similarly deceptive. The "employer portion" is really paid by employees in the form of lower wages. So it really costs you 12.4% of your income, not 6.2%
Bamm83 | 2 hours ago
The pyramid scheme is showing its holes in real time. It's sad because, as a kid, when I first got a job, I remember an old timer explaining social security to me in a way that made me feel like, "nice, I'm 14 and am paying into it early. I'll have so much when I'm done."
Bodoblock | 5 hours ago
Am I understanding the proposal correctly? It only wants to raise the tax rate but not anything else? It should be paired with raising the retirement age, eliminating the payroll tax cap, and potentially limiting benefits to the wealthiest individuals.
mcsul | 4 hours ago
It should be. Net net, we should do several things in moderate amounts: lift the cap, raise the tax rate, raise the age of eligibility, and lower payments.
Raising taxes just to pay for social security means that those dollars will not be available for other uses. Mainly closing the deficit.
WantCookiesNow | 4 hours ago
Raising the retirement age has a disproportionately negative effect on those who need SS most. Agree with the rest of what you said though.
Bodoblock | 4 hours ago
It does but with longer life expectancies and a terrible fiscal situation we all need to sacrifice for our lack of budgetary prudence.
If younger Americans are asked to contribute more, older Americans must also be asked to take less. And of course the wealthiest among us should be responsible for sharing more too.
Massive-Island1656 | 4 hours ago
And yet here we are, the wealthiest nation in human history, talking about who has to sacrifice more. Perhaps we should look at where all the money is and ask why its not flowing more evenly? Perhaps we should focus our combine outrage as a nation not on old vs young, black v white, lady v guy and instead focus on the haves and have nots and how to close that gap.
Bodoblock | 4 hours ago
_Everyone_ has to sacrifice more, but especially the wealthiest among us. I don’t disagree with that at all. That doesn’t mean regular people might have to come to expect less in benefits. Our fiscal state is genuinely horrible.
Dougdimmadommee | 4 hours ago
I mean, even if you somehow taxed every billionaire at 100% you end up with 2 years and change of entitlement spending, and that’s without accounting for any increases for things like M4A or SS solvency or the remaining portion of the current budget + deficit.
This idea that we could just fund anything by only taxing people who have way more money than they could ever need just isn’t grounded in reality.
badluser | 3 hours ago
That is france right now. It is going to become a crisis before it is fixed.
greatuncleglazer | 4 hours ago
Raising the retirement age? As our average lifespan goes down? Spoken like one with wealth.
caterham09 | 4 hours ago
It's already age 67, I don't think raising the age is the right call.
NewEnglandCritterCam | 4 hours ago
The worker to beneficiary ratio is out of control, and is one of the most important aspects of keeping SS funded. Raising the age would help it.
When SS was created, the worker/beneficiary ratio was about 16. From 1960-2000, it was around 3.5 to 5. Now it’s about 2.6. The average monthly benefit for a retiree on SS is about 2,000. That means the average “worker” would need to contribute about 770 a month. Since the SS payroll tax is 12.4%, split evenly by employer and employee, we’d need an average individual income(not including income over 192,300 because of the stupid cap) of 6,200 a month, or 74,000 a year. It’s difficult to find the average income excluding income over the cap, but the median individual income right now is about 55,000.
The math is just not mathing. We need some combination of the following: removal of the cap, increase in the retirement age, reduction in benefits, increase in the payroll tax.
Most people do not want to see a reduction in benefits or increase in payroll tax, so we are left with removing the cap on contributions, and raising the age.
greatuncleglazer | 4 hours ago
Well if it all goes to shit they need to just refund what I’ve paid and let me flail around on my own while throwing the money in an ETF.
UnleavenedTed | 4 hours ago
Or taxing corporate profits slightly more.
Bodoblock | 4 hours ago
US life expectancy is 79 today compared to 75 in 1983 when we set the full retirement age to 67. Our birth rates are also much lower today.
I also believe the wealthy should contribute far more, but at a certain point, basic math kicks in. You need everyone to take less and give more in increments.
greatuncleglazer | 4 hours ago
And other “high income” nations have an average life expectancy of 82+ yet they have better social security programs than the US. What did they do different than us that keeps them from having to increase retirement age? We should do whatever they are doing before even thinking of increasing the age to full SS.
Bodoblock | 4 hours ago
Are you seeing what’s happening in countries like France? Their welfare systems are dangerously under threat too.
fox-master8188 | 4 hours ago
U.S security funding aside from France has allowed those countries to be pacified and divert spendings that would have been used for defense into their social benefits.
Additionally, practically every other developed countries - especially France, is now coming to terms with their enormous debts piling up and having to reckon with cutting social services due to their lower GDPs, increasing deficit, and taxes being unable to sufficiently fund pensions
Hodgkisl | 3 hours ago
They have been increasing their retirement age; Denmark is gradually increasing to 70 by 2040, France recently went from 62 to 64, UK is gradually increasing to 67, Belgium going to 67 by 2030, Finland tying it to life expectancy, Germany going from 64 to 67 by 2031, etc....
On top of it those systems are also struggling to to stay afloat, increasing taxes along with retirement ages is common. Some systems are pushing 30% combined tax rates just for their forms of social security.
CaspinLange | 4 hours ago
25% of people that make it to the 67 retirement age die before they reach 79.
So we’re saying that the less than 12 years that people get to enjoy retirement after giving their whole lives to build and sustain the nation should just work until their deaths.
And that’s the solution
Bodoblock | 3 hours ago
In 1983 the probability of a 67 year old reaching age 75 (the median life expectancy then) was ~77%. Today the probability of a 67 year old reaching age 75 is ~86% as Americans are living longer.
To get back to a ~77% figure relative to today's life expectancy, an equivalent full retirement age would be 68. So raising the retirement age 1-year to account for longer lifespans.
With the expectation that we (especially the wealthy) should all contribute more in taxes, it's also not so far-fetched to raise the retirement age by a year if it becomes necessary for solvency. Obviously I'd like to delay that as long as possible.
dogthatwonthunt | 4 hours ago
they problem with this is, there are still many jobs that can't or shouldn't be done til you are 71.
NewEnglandCritterCam | 4 hours ago
The average lifespan has increased dramatically over the last few decades, even if it’s seen a slight bump in recent years.
When social security was created, the average lifespan at birth was 61.7, while the full retirement age was set to 65. The average lifespan was 3.3 years LESS than the full retirement age.
Now the life expectancy at birth is about 79, and the full retirement age is 66-67. Since SS was created people are expected to get almost an extra 2 decades of benefits.
Even if we use life expectancy at age 65 instead of at birth, people are getting far more years of benefits now.
It is long past time to raise the retirement age. People can still retire earlier, they just need to self fund their retirement until the new age. Some people won’t be able to, but there’s no perfect solution here (other than raising taxes on the wealthy, but politicians who try this are doomed to lose their positions the wealthy elite will just fund an opponent in the next primary/general if they get too out of line)
Super_Mario_Luigi | 4 hours ago
When social security was created, the life expectancy was lower than the retirement age. People are living significantly longer now. You're speaking from what you want, not running a solvent program
golf2k11 | 4 hours ago
People shouldn’t be working around 70 years old. Thats old.
Mountain_Top802 | 3 hours ago
You either lower benefits, increase retirement age, or increase taxes, or a combination. I hate relying on only raising taxes. I pay enough.
Maybe on the rich, but please no more for me and other poor people. A huge part of our burden if supporting the elderly and it’s about to get a lot worse.
AugustusClaximus | 4 hours ago
Really should create a 20 year window where people with a certain amount of wealth don’t get paid out at all. The top 10% don’t need that money, and they aren’t entitled to it since they mortgaged our generation off to fund it
Dusty_Coder | 4 hours ago
GenX paid the tax their whole lives, with the explicit promise of this specific benefit at the end.
We are talking about The New Deal here.
The key word is Deal.
Going to break the deal because of litmus testing?
"I know we had a deal, but you have a 401K so we are going to break it"
Amadon29 | 3 hours ago
The question is whether it's going to be broken now or in the future. We can't honor it forever. The problem with just raising taxes is that the younger generations that have to pay that higher tax will also get lower benefits when they retire.
So okay why should 1 generation be forced to both pay higher taxes and receive less benefits while other generations get to keep the higher benefits while paying less into it?
Dusty_Coder | 2 hours ago
Exactly.
GenX is already currently that "one generation" that you speak of. We already saw the deal modified in our lifetimes. Full benefits began at 65 when most of us started working, now they begin at 67.
All this talk of "saving" social security.. GenX already paid that lump. We already saved it. Another generations turn now.
gt_rekt | 3 hours ago
Why do they need more money when they're already financially secure? SS should be for making sure that we don't have old people dying in the streets.
Dusty_Coder | 2 hours ago
Why are you dwelling on need?
SS isnt welfare. Its insurance.
SuccotashOther277 | 59 minutes ago
Then voters will turn against it because it will be seen as welfare, like SNAP. Congresss will then underfund it and people will demand they not pay in to it if they aren’t getting it
Codex_Dev | 2 hours ago
The old are always going to be in favor of basically enslaving the young, and the old vote, and their vote share is increasingly getting bigger as the birth rate plummets. It leads to a death spiral (pun intended) that collapses a civilization.
magic_crouton | 4 hours ago
Raise it to what? 80? It's already in the 70s for the younger gens
Elf_Maeve | 3 hours ago
lmao reverse inflation while inflation is going crazy.
Good job empowering the GOP the last 40 years boomers. By the way social security wasn't taxed until REAGAN PUT TAXES ON SOCIAL SECURITY.
Boomers 0 IQ
coriolisFX | 3 hours ago
> By the way social security wasn't taxed until REAGAN PUT TAXES ON SOCIAL SECURITY.
This money goes back into the program and made it more sustainable.
BoinkDoinkKoink | 4 hours ago
or a massive tax hike on the ultrarich. ....they've benefitted from lax business policies, low corporate taxes, low capital gains taxes to further enrich themselves with massive compounding of their discretionary wealth via massive asset appreciations. It's time they pay up their fair share of the economic benefit they've received. Else they'll continue to use their excess wealth to influence government policies and elections for their own narcissistic needs, at the expense of the struggling middle and lower class.
The-GentIeman | an hour ago
Just drop the cap and lower the rate and make it solvent for the next 75 years. Those under $180k pay less in taxes. Those $200-300k pay about the same. Those above $300k pay more.
CasualEcon | 26 minutes ago
There's a cap on benefits too. What you're suggesting is a 12.4% increase in taxes for people making more than $180,000 and they would get nothing in return for that
Danger_Vole | 6 minutes ago
Agreed. And they'd be paying for a significant amount of benefits for many retirees who don't need it, and who are pulling out more than they put in. Fuck that.
EESmith2 | 2 hours ago
Stop exempting unearned income. Right now, only earned income is taxed for SS/Medicare, while the parasites are free riders on a function that keeps society stable and working. Lower SS tax rates but apply those rates to unearned as well as earned income.
Why should people who don't earn their income be allowed to avoid taxes?
anarcurt | an hour ago
They shouldn't get a lower rate for cap gains either. There's more than enough capital available to fund the economy there is no need to give a break to encourage it.
Little_Wonder8818 | an hour ago
So retirees who are on SS would now have to pay into SS? Most people who have meaningful unearned income are retirees.
Bruges_1 | 3 hours ago
I would remove the salary cap for contributions, raise capital gains taxes, limit social security benefits for high earners ( despite their contributions ), but keep the current rate.
I say this as someone who has been getting social security payments for 20+ years already.
I would not complain about my benefits being reduced, but I would complain about those who are less fortunate getting their benefits reduced.
Enkiktd | 3 hours ago
I think the limiting social security benefits is a sticking point - I think it's ok to take more from high earners but the point of these systems are that they are safety nets for all.
You had a high income but you had a divorce, then a medical issue that ate your remaining assets around retirement time. This person who paid in a lot to the system is now ineligible because at one point in their life they didn't need it? Especially because of how medical costs can bankrupt people, we shouldn't be excluding anyone that paid into the system.
overitallofittoo | 3 hours ago
This. "We've tried nothing and we're all out of ideas!"
Anonybibbs | 3 hours ago
This is the correct answer right here. Why there is any debate on the subject is beyond comprehension.
Level-Advertising-39 | 5 hours ago
Many of these discussions from both parties seem to first narrow a set of possible interventions and then throw their hands up after the selected set of interventions doesn't resolve the deficit. So many options: removing the cap on taxable income for Social Security, adding some tax to realized gains, etc.
Ok_Principle5942 | 3 hours ago
If you were a Boomer born in 1946 and who started work in 1964, your OASDI tax rate increased 61% over your working life. But those changes were spread out over 30 years. Politicians kicked the can down the road and relied on the Trust Fund, that the outsized Boomer generation helped build up, to ignore the problem. Now that the Trust Fund is close to being depleted, they need to make large adjustedments all at once.
The problem isn't that the tax rate needs to go up. That has happened for every generation, except Millienials and Gen Z, again thanks to the Trust Fund. It's that politicians didn't want to make reforms when the changes would have been smaller and easier. And now they have to do something fairly drastic.
https://www.ssa.gov/oact/progdata/oasdiRates.html
Blue_Back_Jack | 3 hours ago
It’s the Conservatives that want to end Social Security. The Conservatives refuse to fix anything with Social Security.
the_real_MSU_is_us | 3 hours ago
Exactly. Conservatives want to end SS so that old people can't afford to retire, and instead keep slaving away for the boss man undercutting the value of labor for younger workers in the process
CowbogRS | 3 hours ago
Right! Because between 1964 and 2026 the Democrats have never once had control of the senate, the house of representatives and the presidency at the same time.
Blue_Back_Jack | an hour ago
Social Security was ‘fixed’ in 1984.
Al Gore was ridiculed in 2000 for attempting to keep social security solvent.
jsta19 | 3 hours ago
Begun, the generational culture war, has.
Just a new way to divide us rather than looking toward the bigger sources of money that should be taxed.
TastySpermDispenser7 | 5 hours ago
Smh. Its the boomers that made a choice to spend their retirement money on Vietnam and bombing brown people. I will never understand why kids much younger than me have to pay for me and other able bodied men to sit at home for 40 years, not working, mocking the people who are working, and literally voting to hurt you guys. What did we do exactly that I get your money before your kids get school and healthcare? This shit shouldn't be in 8 years, it should be full stop right now so that the people who voted to spend that money actually have consequences for their choices, not you guys...
hczimmx4 | 5 hours ago
Boomers had their SS tax rates increased. Boomers had nothing to do with Vietnam, they were too young when that started.
Own-Chemist2228 | 4 hours ago
>spend their retirement money on Vietnam and bombing brown people
This sentence is peak reddit. Confidently incorrect, blaming "boomers", and attempting to make everything about race.
Baby Boomers were in their late teens, early 20s during Vietnam. They were drafted to fight the war, protested the war, and had little influence on policy because there just weren't as many of them compared to the size of the population that was thirty years or older at the time.
It was their parents and grandparents that were making the decisions. They are long dead.
capitalsfan08 | 4 hours ago
... how old do you think Boomers are? Do you just mean old people? Boomers were max age 30 when Vietnam ended.
manliness-dot-space | 5 hours ago
We spend like $7T a year and less than $1T of that is for national defense.
This idea that all the money goes to war is nonsensical. All the money goes for the poors and the olds.
Hodgkisl | 5 hours ago
Uhh, social security is it's own self funding program with a tax that goes to it and it alone, it is not part of the general fund. The major problem for once isn't the boomer era but your parents and grandparents, the older generations paid far too little in and got too much out; planning for the population to continue growing, relying on the working population always far exceeding the retired.
For most of the boomers working life the total SS tax paid has been over 10% of your income, while for your parents and grandparents it was mostly under 7% going as low as 2% at the beginning.
If boomers have any blame in this it is having less kids than previous generations and generations after you are compounding that fault, but in many ways less kids is a good thing.
Pitiful_Fox5681 | 4 hours ago
Reduce benefits by 4% a year and raise the tax by 1% a year between now and 2032. We'll tighten our belts a bit but save the program for ourselves and future generations.
Once the workforce is larger than the number of retirees, it'll be a non issue.
jeon2595 | 4 hours ago
Problem is the projected ratio of workers to retirees continues to shrink for the rest of the century.
HolyInlandEmpire | 4 hours ago
Correct. This is kicking the can down the road, while squeezing the younger generation harder, reducing the number of children they can have even further, and it will have to happen even more.
Taxes rising on the young while the fertility rate is below replacement and falling is not sustainable, including for the people who would like to be recipients of the social security.
therealbjmurphy | 4 hours ago
The workforce will not ever again be larger than the number of retirees barring some both unforeseen and unlikely baby boom
https://www.cbo.gov/publication/61164
Pitiful_Fox5681 | 3 hours ago
I think there's a pretty big difference between 2055 and never.
My assumption is that we have at most another century of shrinking generations until a little rebound is inevitable (oversupply of housing will make it cheaper, smaller tax burdens for smaller populations, likely fewer regulations in more sparsely populated areas, and so on will make it a lot easier to find your feet and get on them).
AdministrationIll619 | 3 hours ago
Reduce benefits?
Political suicide for even the GOP when millions rely on SS to survive. You are more likely to levy a boomer wealth tax to offset the lack of funding.
Codex_Dev | 2 hours ago
The old are always going to be in favor of basically enslaving the young, and the old vote, and their vote share is increasingly getting bigger as the birth rate plummets. It leads to a death spiral (pun intended) that collapses a civilization.
Tough_Journalist400 | an hour ago
Benefits will have to be reduced but they’re never going to come out and directly say “5% cut to SS next year.”
The most likely solution for cutting benefits is revising COLA to mirror Chained CPI.
You’ll probably see a plan to have differential COLAs depending on benefit level. So those getting higher SS payments will not get the full COLA.
We’re also likely to get a combination of :
1-2% tax increase
a full retirement age of 68-70
more quarters required for eligibility (40 to 60/80)
increasing the cap to ~$250k a in income
reduction of spousal benefits
changes to SSID program
more bend points on benefits reducing the return for higher income earners
state and local employee inclusion into the program
possibly some privatization to get investment returns into the fund.
Also, this is 100% going to come out of a bipartisan finance committee. Whoever is president will agree in advance to sign whatever bill comes out of the committee. My best guess is it will happen in 2029. Neither party is going to want this hanging over the 2032 election.
lion7725 | 51 minutes ago
They would just suspend COLA (which tracks inflation, so 2-4%) as opposed to an actual decrease
nkosugeirc | 4 hours ago
Lol, they'll just do more tax cuts for the rich and handouts to Israel.
Psubeerman21 | 3 hours ago
Got a time frame on that societal shift where people decide to have more children?
Pitiful_Fox5681 | 3 hours ago
Answered in another comment, but I can't picture a rebound being more than a hundred or so years out.
HeKnee | 4 hours ago
Reduce benefits for the boomers by whatever is necessary to fix funding formula for future generations. They messed it up, failed to fix it, and deserve all the blame/pain.
SirOutrageous1027 | 3 hours ago
And which political party is committing suicide to do that?
HeKnee | 6 minutes ago
Its gotta be bipartisan, but yeah unlikely to happen until enough boomers die and by then its a non-issue.
Admiral_Strawberries | 4 hours ago
Why not just uncap the social security tax? That would fix it right now, and involve pretty much no belt tightening for anyone who it wouldnt be a rounding error for
Open_Pollution_8038 | 4 hours ago
Because right where the wage limit gives up on social security taxes, an 8% increase on income taxes kicks in. You don’t save any money, the government takes it for a different pot.
You shouldn’t have to pay 40% of your income in federal taxes alone after $180,000. That hits upper middle income families hard in cities. Once you tack on state and local taxes you’d be taking more the half their income which is a worse deal than even serf farmers got.
Ok-Post2247 | 4 hours ago
Most W2 high earners are actually carrying a European style tax burden without the benefits. This would push marginal tax rates to almost 70% in some states. The fiscal drag would be immense and when Warton modelled out a cap raise (to somewhere in the mid $300k) it slashed 3% off the 10 year GDP and cost almost a million jobs. There's no tax side fix for this that doesn't risk a recession and immense economic pain for everyone. There's well over a trillion dollars in unfunded old age entitlements. The boomers were warned about this for 40 years. Benefit cuts will have to be part of any realistic solution.
Open_Pollution_8038 | 4 hours ago
We have the most progressive tax system in the OECD.
But all you’ll hear about it from people is how the rich don’t pay taxes.
No, it’s because we blow an entire middle class street worth of lifetime tax contributions on a missile launched at a man and a donkey in Iran every 10 seconds.
HrothgarTheIllegible | 4 hours ago
We’ve also created a class of people that pay minimal taxes because they don’t make the majority of their money through salary. Corporations intentionally pay low salaries, but have guaranteed payouts in options in the millions to avoid salary taxes. The problem is the salaried people bear the burden of paying the most proportional taxes while multimillionaires can afford to cut their tax liabilities to a single digit percentage of their income. We can’t keep cutting loopholes for them, and saying loans on stocks, or compensation on stocks enjoy indefinite differed taxation.
Bastillerion | 3 hours ago
Not only that, but our bottom half don't pay anywhere near the taxes that their counterparts do in Europe.
HrothgarTheIllegible | 3 hours ago
Yes, but the government also don’t provide half of what European counterparts do. Half of that is the dumb amount of corporate subsidies we provide and the other half is our penchant to run military campaigns for stupid ass reasons only to make us more vulnerable.
Open_Pollution_8038 | 4 hours ago
This.
I’m not even going to cry for the C suite people but those guys are paying half their checks in taxes, it’s the owners of these businesses that are paying half the tax rates.
Even stock comp is taxed upon vesting as ordinary income.
Get a million in RSU? That’ll be about 50% upfront to the government.
mazzmond | 3 hours ago
Just want to praise the sanity and intelligence of this group compared to the typical social security discussion I've read on reddit.
As a high income individual myself I strongly oppose eliminating the cap. As most have said it's a 12.4 percent increase and would be the biggest tax increase I've ever seen and would push my tax rate a bit over 50 percent when you include state, local etc.
EchoFieldHorizon | 3 hours ago
You could save money by making less money
mazzmond | 3 hours ago
This is what very high tax rates do. Without doxxing myself I'm a medical profession and am a sub specialist. I do a few weeks a year of locums at a smaller rural hospital because they don't have access to all the medical care and all of the specialties (I actually get paid less per hour compared to my full time job at a larger institution). This require being on call and coming in at night as well.
So it does exactly that...it makes me less willing to sacrifice my time, body to try and fulfill a need that's being unmet in smaller communities. And yes money isn't everything and I do enjoy the work but its an additional disincentive to do it.
Open_Pollution_8038 | 3 hours ago
This - why go to work to make effective half your wage. I’d rather just take time off than work on a fucking half off coupon.
Tough_Journalist400 | 3 hours ago
I’m exiting the workforce soon for this exact reason. My partner makes enough to put us in the top bracket and it really makes working pointless from a financial POV. I maximize tax advantaged accounts but even in a low tax state I’m paying over 50% marginal and nearly 40% effective.
I’ll spend a few years with the kids and making the home life easy af over 45 hour weeks and running around in circles.
Open_Pollution_8038 | 3 hours ago
This, people wonder why this country is setup to just passively invest and take it in and look no further than a tax code the disincentives people to work.
Ok-Post2247 | 3 hours ago
This would be a problem in any industry with high earners. Do you really think a 50 year old Airbus Captain in San Francisco is going to wake up at 4 in the morning, battle traffic, and deal with airport coffee, to take six tons of steel and fling it 500 miles an hour to New York for 38 cents on the dollar? No! They just don't pick up that trip. They make less money but that's money that wasn't created to tax. In addition to being a goofy idea for other reasons, uncapping social security also hurts the general revenue.
CanaKitty | 2 hours ago
That’s a big issue in the UK right now with there being an income cliff
Ok-Post2247 | 3 hours ago
It would be the largest peace time tax increase in American history, distort the economy, and not even fully solve the problem. That's before you get to the practical argument that raising taxes as high as they can realistically go to pump out a third of the funds to people with over $100 k a year in non social security income is even a good idea. It's a silly idea that panders to the 60 plus voting block or placates the people who are mad some lawyers make $350,000 a year and they don't. If America has the appetite for a trillion dollar tax grab let's put food in children's mouths and fix our crumbling infrastructure rather than worry if a retired dentist has to dip into their multimillion dollar Fidelity account for the upgraded beverage package on their second cruise of the year.
pgtl_10 | an hour ago
It's really a sane idea but this subreddit won't accept it. No cap on SS is the best way to go.
TheMasturbatinCamper | 3 hours ago
This is what gets me. I’m Gen X and people were talking about the Social Security problem in the 80s. So Boomers, X, and Millennials all decided to ti ignore the problem and spend the SS money on the general budget. Well, since we spent the money, we have to take cuts to benefits
Ok-Post2247 | 3 hours ago
The actual problem is that boomers decided they didn't want to pay realistic payroll taxes for what they were promising themselves. For the first 40 years payroll taxes were increased 17 times, usually half a percent every few years. When the new rate was set in 1983 the actuaries knew even being off a tiny bit could cause huge distortions over time. That wasn't a big deal! You just do what had been done every time the math was off for 40 years and raise taxes. The boomers broke this "sacred generation bond" when in the 90s the math showed a swelling gulf between benefits and taxes and they refused to raise their taxes to meet the problem. They then continued to refuse to fix the problem as it worsened for 40 years. Now that they are no longer working people they want massive tax hikes on young workers when they refused even minor tax increases as working people.
Crew_1996 | 2 hours ago
No it won’t. The realistic solution will likely be SS taxes kicking in for individual income over $300,000-$400,000 with no tax on income between the current income cap and the new number.
Ok-Post2247 | 2 hours ago
Doesn't solve enough of the problem to be worth it. It's a numbers game and there are more dentists and optometrists than people on an MLB contract. Some kind of a 1-2% surtax might be viable without massive economic effects but I think people are vastly underestimating the scale of the problem.
emuskisacunt | 4 hours ago
What about the donut hole approach, keep the current cap , but lift it at a high income say instead of $184,000 make its $300,000
Open_Pollution_8038 | 4 hours ago
Nah man even $300k is smacking doctors. We should be taxing cap gains at about 25-28% for those making over $1M/year.
That would be more fair.
siclox | 3 hours ago
Raising the cap does nothing as it also increases the payout.
Can’t increase the contribution without also increasing the payout.
_Being_a_CPA_sucks_ | 3 hours ago
You can 100% write into law to increase the cap but maintain current levels of benefits.
Tough_Journalist400 | 3 hours ago
This is would be a disaster for the Democratic Party. They’ve finally become the party of the highly educated, high wage earners and demanding higher taxes only from them would be a gift to the GOP who will promise to lower taxes.
I know everyone wants someone else to pay for things but a 1% tax increase across the board, a raised cap (not removed) and a minor benefit cut would be far more fair. It hits everyone a bit but those who can afford it a bit more.
Pitiful_Fox5681 | 4 hours ago
Despite getting repeated a lot online, I've never seen a rigorous study showing that this would make a significant difference.
Right_Lengthiness266 | 4 hours ago
https://www.ssa.gov/oact/solvency/provisions/payrolltax.html
You can go here and look at the actuarial analysis of all the different proposals to fix social security. Eliminating the tax cap and providing benefit credits for all additional payments resolves 45% of the long term actuarial shortfall.
Eliminating the tax caps and not providing benefit credits above the current max resolves 58% of the long term actuarial shortfall.
There are several other proposals listed that fall in between those 2.
jeon2595 | 4 hours ago
Temporary fix, sooner the cap is lifted the longer it extends full benefits. If I recall correctly eliminating the cap now would extend solvency for 15 years. There is almost no way to avoid a tax increase.
0WatcherintheWater0 | 4 hours ago
People with high labor incomes are already paying the highest taxes of anyone. It would not be a “rounding error”
But that’s not the main concern, by just lifting the cap, you’d be massively expanding benefits for the wealthiest retirees while doing nothing to reduce the cancerous benefits growth that leads to high taxes for workers and sees retirees consuming ever more and more national income.
A much better fix would be to adopt a flat benefit structure, and index starting benefits solely to CPI, rather than AWI
Voyce4Englewood | 4 hours ago
This would also mean that the businesses employing those people would have their 50% share of that tax also uncapped. Good way to increase unemployment overall
Bastillerion | 3 hours ago
Only if we uncap the benefits.
Icy-Sheepherder-6221 | 32 minutes ago
The way to cut benefits is to underestimate inflation for the COLA increase (which honestly they’re already doing), so the checks don’t actually get smaller, they just don’t get bigger fast enough. We’ve known about this for decades. The solution is a little of all of the above: reduce benefits, means test for eligibility, increase payroll tax, raise or remove the cap.
-XanderCrews- | 4 hours ago
Or we could tax the boomers that have made gains of those not being taxes their entire lives. 5 guys have as much as half the country. Remove the cap and tax them.
Hodgkisl | 4 hours ago
Just a heads up, Musk, Bezos, Page, Brin are all Gen X not boomers, the only boomer on the top 5 richest is Michael Dell.
caterham09 | 4 hours ago
reducing benefits 4% a year for 10 years is a horrible idea.
Pitiful_Fox5681 | 4 hours ago
Good thing 2032 is just five years and two months out, then.
Dusty_Coder | 4 hours ago
"Dear GenX, Its only 4%"
meanwhile you are taking almost half of whats left of what was promised to them their whole lives after paying into it their whole lives
So the Boomers stole from GenX, and now the millennials and gen Z are also stealing from GenX
You break this deal we will collapse your world
BluCurry8 | 4 hours ago
Or just get rid of the cap and tax investment dividends the same as you do working income. There are plenty ways to fix this without screwing over people living off social security now. When people pander to the extremely wealthy to screw the poor it always ends badly. God forbid people actually have to pay their fair share.
Hodgkisl | 4 hours ago
That's talking about pushing to an 18% tax rate to pay out less than 10% privately invested would.
Unctuous_Robot | 4 hours ago
Great plan. Too bad nobody can afford to have kids and good paying jobs keep getting rarer.
freedraw | 4 hours ago
Or just raise the cap.
satoshisfeverdream | 3 hours ago
Once is doing a lot of heavy lifting in that last sentence.
klingma | 3 hours ago
>Once the workforce is larger than the number of retirees, it'll be a non issue.
It's already bigger than the number of retirees. The problem is that it used to be around 5 workers per retiree, but now it's around 3 and will drop to 2 over the next 30-40 years.
IMakeOkVideosOk | 3 hours ago
Unfortunately the workforce will be shrinking
random-meme422 | 3 hours ago
I’d rather drop social security entirely rather than turn into france where a smaller and smaller share of workers is getting screwed more and more for old people to get a check when they had their whole life to save and benefit from explosive growth
inverted_goose | 2 hours ago
Dropping is the smart answer. People need that government teet though.
CyberSmith31337 | 3 hours ago
Not interested in supporting the boomers anymore. I don’t care if it’s ignorant; society got it wrong.
We should be supporting the youth, the working class, and those who are still actively contributing to society, not mooching off of it. The fact we cover healthcare for geriatrics more than we do for kids and newborns is a completely asinine problem here in America. Robbing the youth to extend the benefits of those 70+ is absolute stupidity.
Bastillerion | 3 hours ago
I've said it before and I'll say it again. Proposing to eliminate the cap on SS tax contributions is a bad faith proposal. First, Social Security benefits have always been indexed to what you pay in. If you eliminate the cap on taxes without eliminating the cap on benefits, you're transforming Social Security from an old-age insurance program to a welfare redistribution system. That is not what Social Security was created to be, unlike SSI, TANF, WIC, EITC, and so forth.
Second, let's take our high tax states like California. The top federal marginal rate is 37% and the top CA rate is 13.3%. That's a combined rate of 50%. If you uncap Social Security, and make it like Medicare which is already uncapped, you're now talking about 15.3%. So a dual income professional couple making $750k who were previously paying 48% in combined taxes are now paying 58%. Do you think that's reasonable or will it discourage work?
People always talk about "the billionaires who don't pay taxes," but EVERY one of these proposals is targeted at the group I call the "W-2 rich." This means that they have high incomes, but they have to work for it every day. If your problem is the capital class, then raise the long-term capital gains rate, which I agree is far too low.
But proposing to eliminate the SS cap is either borne out of ignorance or intellectual dishonesty. There is no third option.
LargentduBeurre | 3 hours ago
Social Security already is a welfare redistribution program. It’s welfare for the old, paid for by the young. People think that because 1) the taxes that pay for it are listed separately on your return, and 2) the benefits are indexed to your old salary, that it’s some sort of government mandated retirement account. It’s not. It’s welfare for old people.
Now, I tend to agree that merely removing the SS tax cap isn’t the solution here, but people need to realize that Social Security IS welfare. That doesn’t mean it’s bad or that we should get rid of it, but it’s impossible to have an actual conversation about it so long as we’re all pretending that it’s a special account where you “get out what you put in.” It’s not and you don’t.
As an aside, the whole “discourage work” argument is silly. It’s fine to say we shouldn’t raise taxes on that couple making 750k because it’s unfair, but I promise you they aren’t going to quit their jobs or go work as servers to avoid paying more taxes.
Ready-Percentage5286 | an hour ago
You're not wrong.
I usually hit the ss tax cap sometime in August and it stops being deducted from my pay. I experience it as a minor, but appreciated bump in my takehome pay for the last part of the year.
Same is true for literally ALL of my close colleagues. There is a zero percent chance that any of us would change our working habits if the cap went away. The biggest impact would be feeling bummed out for fifteen minutes when we first get paid in September.
post_button_account | 3 hours ago
Not true at all. My partner and I have both left high paying (but long hour jobs) because the "net incremental pay" was not worth it.
With lower taxes, Id have definitely worked longer hours.
pgtl_10 | an hour ago
That sounds silly.
Bastillerion | 3 hours ago
Exactly. Every argument for "taxing the rich" uses billionaires as examples, but the taxes proposed never actually target those people. Why is that?
lol_fi | an hour ago
Because billionaires are major lobbyists and people working as doctors, lawyers and engineers aren't. And doctors, lawyers and engineers seem rich to the average person
MurrayDakota | 2 hours ago
How about a donut-hole approach?
The cap is raised, to maybe $300k. But so benefits.
But once you hit $300k, the cap is reinstated (commensurate with the benefit cap).
But the cap is eliminated again at, say, $750k. But benefits don’t go up.
As in, the benefits match the cap, up to $300k (or whatever), then no SS is taken out until you earn $750k (or whatever), at which point SS is again paid into, but the payor will not get any SS benefits based on the higher, increased payments.
Bastillerion | 2 hours ago
If we’re going to do that, better to just fund it from general revenues and a higher marginal normal rate. Even if the concept is okay, I think $750k is far too low. Maybe $4 or $5 million
AlternativeNorth6613 | 3 hours ago
redditors are just idiots/low income people who cannot think for themselves and want the government to solve all their problems
Magician_Monkey | an hour ago
ah yes, let's not increase SSI, so all the old people that have no other income source perish
The_Admiral_ | 40 minutes ago
In 2035 debt interest is going to consume 50% of all government spending. This Titanic of socialism is going down hard and I'm here for it.
Bastillerion | 3 hours ago
They don’t think through the consequences of their “solutions.”
EveryDayTheSingleWur | an hour ago
Seeing the world is changing, and the wealthy are more wealthy than ever while literally everyone else is struggling, and expecting the wealthy (who are exploiting society for their benefit) to help finance the society they are extracting from is not stupid or uneducated. Magats, however, are stupid and uneducated.
Especially now with AI potentially taking millions more jobs, we have to acknowledge the world is not the same as it was 60 years ago. To ignore that is ignorant.
Reality in the 60s was very different from today. There was actual competition between companies. Small town America thrived. You could open a grocery store in a small town, employ a few dozen folk with good benefits and still make a living. Today, you can't.
Today a few tech/other (amazon, walmart, uber, grubhub, etc) companies have decimated small town America, and funneled all the money into themselves.
Change is required, whether it's social security, UBI, or something else. Denying that means you are a brainwashed moron who thinks any day now you will be a millionaire.
Guess what: you won't be.
Alaska_Engineer | 3 hours ago
Intellectual dishonesty is using marginal rates as overall rates in your argument.
Jolly-Structure7646 | an hour ago
The fact CA taxes the shit out of its residents is solely a California problem. Nobody else cares.
The real problem is people live and collect SS too long. It wasn’t designed to pay benefits for 30 years especially when the program only requires 10 years of work. The number of quarters required to qualify needs to be raised to 80 and unfortunately the retirement age must go up a bit too. Drop the spousal benefit where people with zero contributions get a free check.
Bastillerion | an hour ago
I do agree with all of that but many other states have taxes almost as high
Jolly-Structure7646 | an hour ago
But some states have zero. It really is a local issue that voters have decided.
Bastillerion | 52 minutes ago
Did voters decide for their own taxes? Or did Shaniqua vote to raise taxes on William?
Particular-Way-8669 | an hour ago
That is because no kind of wealth taxes will generate enough revenue to cover those bills.
That aside. What you are missing is that if you give pensioners more money it does not really matter from whom you that money collect. Because you will be affected anyway. Why? Because that pensioner get that increased pensions and competes over limited amount of real estate, goods and services. So working age people will fund end up funding it regardless.
Bastillerion | 33 minutes ago
Too many fucking Democrats on this sub. Stupid, emotional and illogical.
olmnknt | 2 hours ago
"One option would be to raise payroll taxes. Social Security is primarily financed through a 12.4% payroll tax on covered earnings, split equally between workers and employers at 6.2% each, up to an annual cap. That taxable maximum will rise to $192,300 in 2027 from $184,500 in 2026, according to the SSA."
Or maybe, just maybe, take the cap off of the SS payroll tax.
"The Social Security tax cap (or taxable The Social Security tax cap (or taxable maximum) is $184,500 for 2026 and rises to $192,300 for 2027. Earnings above these limits are not subject to the 6.2% Social Security payroll tax."
Remove the cap, fix the problem.
After solvency is truly achieved, the 6.2% could even be lowered.
Mbstranche08 | 3 hours ago
The financial system and the fiat dollar it inhabits are terminally ill. Once a business cycle is dependent on debt to operate, there is a constant need for equity that comes in the form of growth or realistically synthetically generated inflation via federal Reserve. When the aggregate populace is not able or willing to participate in buying “furtherance of credit expansion” the system is defunct. Why we can’t inflate out of our current situation is due to that consumer inadequacy. Assets are only assets because financial institutions are refusing to mark properly in their own self preservation. I know this sucks for the wealthy. It absolutely sucks for the financial industry. It simply comes down to 1 of 2 options.
One -committed austerity. This would lead to the greatest financial crisis in macroeconomic history. Being as over leveraged as we are deflating through the credit cycle would bankrupt nearly every company publicly and private. Critical infrastructure would collapse leaving those in need of emergency care in a bidding war to get a previously institutionalized medical doctor to come out of his or her dwelling to help. The magnitude of this downturn is so violent mainly from too big to fail policies. You take down Amazon and FedEx the collateral damage is eminent. All of these corporations own each other. One big corporate spider web.
Option two-. Debt Jubilee and a return to sound money. Pinning a currency to a basket of commodities to achieve stability and credibility. Accompanied by an obligatory debt wipe. We initially pay off foreign creditors in M1 before monetizing it digitally. Yes I understand what that means for those in financial speculation. The party would be over. We have no other option though. Instead of waiting for something to snap I hope we can make the call sooner than later. Stop thinking about ourselves and let grace have it’s way with us. I know most policy makers are in financial speculation. Investment bankers, central bankers and private equity titans. Please do what is right before it is too late 🙏
formerNPC | 3 hours ago
How does the workforce increase when half the workers will be unemployed because of AI. Something has to give. The population is declining and people are living longer which means more benefits being paid out. It’s not going to balance out by itself so what is the sensible solution? Unfortunately the people in charge have no answers because they have to take care of wealthy donors and billionaires first so I guess we’re on our own!
Danny-1979 | 3 hours ago
Raise the SS cap using the donut hole approach, and tax the SS of the wealthy. SS should go to those that actually need it. It didn’t help that the general budget surplus of 2001 was pissed away by GW Bush’s tax cut, and his going to war in Iraq on a false pretext.
AstralVenture | 2 hours ago
Why on Earth would any Gen Z and Millennial work for 40% less of their money from one year to the next? Congress must want to destroy the place. I propose the following solutions:
The 12.4% OASDI payroll tax (split 6.2% employee / 6.2% employer) is applied to all wage and self-employment income above $250,000, creating a brief "donut hole" between the existing statutory cap and $250,000 that closes automatically as average wages rise over the decade.
Ultra-high-net-worth households derive the majority of their compensation from capital gains, dividends, and passive business income rather than W-2 wages. Amend Internal Revenue Code § 1411 to apply an additional 12.4% dedicated OASDI assessment on Net Investment Income (NII) for single filers earning over $250,000 ($400,000 for joint filers).
The Old-Age and Survivors Insurance (OASI) Trust Fund and the Disability Insurance (DI) Trust Fund are legally merged into a single unified Social Security Trust Fund, ensuring seamless actuarial management.
samgfrank | 4 hours ago
As someone who makes over the cap, eliminate the cap.
It’s so dumb, suddenly around Oct my paychecks go up because I’m over the cap. All year I budget for less, and then the gov hands me a holiday bonus at the end of the year.
I’ll be fine in retirement, I max out Roth 401k and own my home.
Don’t pity the wealthy.
That being said, part of me dislikes the boomers for voting for tax cuts their entire lives and are now facing the music and wanting a bailout.
AlternativeNorth6613 | 3 hours ago
12% marginal tax increase would be the biggest tax increase in history.
Someone in a high tax state could be paying 55%-60% of their income in taxes at the margin
Kevin_Palpatine | 4 hours ago
My comments keep getting removed for being too short. Mkay, here we go: If we raised the cap, it would be funded. Its really that simple. If we raised the cap, it would be funded. Its really that simple. If we raised the cap, it would be funded. Its really that simple. If we raised the cap, it would be funded. Its really that simple.
d_k_y | 4 hours ago
Removing the cap maybe covers half. Need to also increase the cap, cap benefits and either reduce benefits for all or increase the overall tax rate. There is no one thing you can do to fix.
ohhhbooyy | 4 hours ago
All you’re doing is kicking the can down the road. As long as birth rates go down the formula that was made decades ago with increasing population and lower life expectancy won’t work
Mountain_Top802 | 3 hours ago
Unless efficiency keeps increasing as well with AI and new technologies
Illustrious-Swan-638 | an hour ago
Actually as morbid as this sounds, life expectancy actually dropped. So...this problem might solve itself, lol
wocka-jocka-blocka | 4 hours ago
You don't realize how much money is increasingly sloshing around at all the capped income levels that would suddenly start paying into the system.
Every other western first world nation manages to make this type of system work. Except the US for bullshit reasons like the cap. Do birthrates have an effect? Of course. But these problems are completely manageable when YOU'RE NOT CUTTING YOUR PROGRAM OFF AT THE KNEES LETTING RICH PEOPLE OFF THE HOOK.
AK_Panda | 3 hours ago
I don't disagree with you suggestion, but I would point out that the cost of pension schemes is a massive issue in almost all western countries. The demographics is just fucked.
ohhhbooyy | 3 hours ago
You’re probably not aware but most of the western first world are having the same problems. Take a look at France, Germany, Italy, etc.
Less young working adults and much more retirees.
ary31415 | 3 hours ago
Pensions in France famously going great right now
BernedTendies | 3 hours ago
lol
BernedTendies | 3 hours ago
Raising the cap kicks the can. It’s is, indeed, not that simple
Justthetip74 | 3 hours ago
It would not be fully funded, its solvent for 75years best case scenario
Kevin_Palpatine | 3 hours ago
So better than 2032?
Justthetip74 | 3 hours ago
Sometimes you've gotta rip the bandaid off
Kevin_Palpatine | 2 hours ago
Yep. Agreed. Raise that cap.
Erik_Lassiter | an hour ago
Or … hear me out here …. We just raise the cap and make billionaires and trillionaires pay their fair share.
Seems like the simplest solution to me - eliminate the cap.
ApprehensiveEbb592 | 4 hours ago
How about congress stop stealing money from Social Security “trust” fund. Like they have been since at least the Johnson administration. Of course, they could do something really unusual and replace the money! Of course, the leeches in congress will never admit that they stole the money in the first place.
OG_Felwinter | 4 hours ago
Let it drop the 22%. People invested 50% of the input, now they’re going to get 78% of the output. If we increase payroll taxes, the drop will be much more impactful upon reaching this point again.
Hnry_Dvd_Thr_Awy | 3 hours ago
People absolutely invested 100%. Calling the employer's share not the employee's money is misleading as heck.
Upbeat-Elevator3641 | 4 hours ago
Add a tier from 400k and up to social security cap.
Reduce COLA to 2/3 of annual inflation levels.
Increase corporate tax rate by 2% and dedicate that additional income to the SS Trust.
plasticbug | 3 hours ago
Social security is effectively a ponzi scheme where the young subsidies the elderly. It worked when economy and population was growing, but it is unsustainable now. We should have made 401k mandatory with forced employer and employee contributions, and use social security as a top up, rather than make it a guaranteed payment. We should start doing thst now. Maybe even with an option where you get tax breaks in exchange for foregoing your ability to claim it in future.
americanspirit64 | an hour ago
The last cost of living adjustment I received half of it was to cover the cost in the increase of part A of Medicare cost, all of the rest didn't cover the rise in the price of Part B coverage under Trump in 2019 when the government shoved Advantage Plans down everyone's throats, giving insurance companies a handout. That year the cost of living increase was 2.5%, I figured out I actually lost about 3/4% of my Social Security which didn't rise a bit. They call it a cost of living increase, when it really is an increase to Part A and B. Also all of figure's for Social Security they used in the article were for married couples. My wife who left me 6 years before divorcing me, which put her in the time frame, on her lawyers advice that she could collect half my SS. Because of this the IRS increase the SS tax I paid yearly until I turned 66 by 75% as a penalty for her living out of the country and not paying taxes during that time. Even though I had 48 years paying into Social Security and Medicare although I never had a high paying job as I was a school teacher. After paying Part A and B, I can't afford D or Drug or Dental I receive and live on $757.00 dollars a month. That is the true way SS works. With Medicare I now pay more monthly for health insurance then I have ever paid at any time in my life, even when I was working and paying for my wife's and son's healthcare insurance.
tawaydont1 | an hour ago
If you people don't like boomers, then you should get out and vote inside of the midterm primaries. But you didn't, so now we have to choose between old people who are out of touch and don't really know what it's like to work right now. They are looking at statistics and telling people that it's the way of life for everybody on both sides.
jbaker8935 | an hour ago
probably some form of means tested cuts. eg, high pension income reduces current payout up to 22% or so. It would be graduated downward so that the 14% or so that have SS as their only income will not have their benefits reduced. the diff will be made up with a more modest payroll tax increase. plus some 'ubi' like investment fund to help offset the differences for younger people.
Cuts will suck for the marginal folks who's retirement plan was based on the original SS formula. private employees that were fortunate enough to get pension, folks that contributed to their 401k investment accounts for 35+ years, public and private unions will hate it. It will require a QOL change, but the mandatory 22 was gonna do that too.
Dumb ass congress demagogued any attempt at fixing this earlier when it would have been much less painful.
Calm_Chemist_4952 | 25 minutes ago
Stop trying to create generational animosity. The obvious answer is to tax the rich. This country has far too much economic disparity. The rich have been getting a free ride for too long. A society that doesn’t take care of its elders needs to adjust its priorities. Figure it out.
bullydog123 | 9 minutes ago
If we would tax millionaires and billionaires properly. We would not benun this situation. But it all started with Ragin and his trickel down economics. Well we see how that works. The rich get rich and the people that actually make this country work get poorer. Taxen millennial and Gen Z more is not the answer. We all know the answer but the Republicans and the oligarchs will never let that happen
titandude21 | 4 hours ago
Remove the social security income cap without raising benefits. Problem solved without having to raise the SS tax rate. Actually make the rich pay their fair share when they're already bigger welfare recipients than everyone else.
throwingitaway12324 | 4 hours ago
The people that get affected by the cap being raised already pay the bulk of all taxes (w2 earners). This doesn’t affect the actual wealthy who do not rely on w2 income.