A recent Wall Street Journal article reports that a White House-created commission is considering proposals to “fix” Social Security, prompting key players to prepare for a major battle over the program’s future.
Here are the most prominent ideas:
1) Raise the retirement age.
2) Reduce the rate at which benefits grow each year.
3) Reduce benefits for wealthier retirees.
4) Subject a greater portion of income to Social Security tax.
5) Raise the Social Security payroll tax, now 6.2% for employer and employee.
Social Security officials project that beginning in 2014, the program will routinely pay out more in benefits than it collects in taxes, requiring it to draw on reserves that Shave been funding the rest of the government. By 2037, the reserves would be depleted and the program would only be able to pay about 75% of promised benefits.
Our Social Security program is another ponzi scheme. There is not lock box. All of these schemes end in a similar way. They will collapse when the number of new investors is outpaced by the number of current investors pulling out their money. With current demographic shifts, this is happening. The last investors in do not get their money back.