As it is the plan is to cut social security benefits by 25% when the trust funds are spent.

[dawg]

168. Or ... the current estimates might be overstating the problem.

The trustees have every incentive to be overly pessimistic with their projections. (Here in Georgia, we call it CYA - covering your ass.)

In the early 2030's, the Millennials (a huge population bulge) should be near the peak of their earning power.

Nearly twenty more years of technological change will have transformed our economy in ways that we cannot currently imagine.

I tend to be cautious and incremental about changes to systems that millions of people depend upon. (I won't say 'conservative', because I no longer use that word in any positive or neutral context.) The first step, for me, would be watching and waiting.

If, ten years from now, the trustees are still predicting depletion in 2033, then it would be prudent to consider taking some action. If, however, the projected date of depletion has been pushed forward (as has happened for all of my adult life), then I would continue to call for watching and waiting.

Once we got within a ten year window, and it became apparent that changes really might be necessary, the fist step would be to increase both the wage cap and the countable wages for benefit purposes, so that the same proportion of wages would be covered by the program as was the case in its heyday. This would increase future liabilities as well as raising more revenue, but due to the progressive nature of the bend points within the benefit calculation, it would be a large net positive for the trust fund.

If, after several more years, the life of the trust fund continued to fall below ten years, then adjustments to taxes (and potentially benefits) should be weighed and considered.

It goes without saying that I come down on the "raise taxes rather than cut benefits" side of thing. But there could be some exceptions.

Did you know that once I start collecting Social Security benefits, I could remarry a younger woman, start a new family, and my children would get Social Security checks just like those of a disabled worker? Even if I'm rich as Midas. So there are some things on the benefits side that could probably be changed without placing an undue hardship on the people who really depend on the program.

Regardless, it makes little sense to respond to a potential shortfall by making an insane pact to collectively lie to ourselves about the true rate of inflation.