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Are Cuts to Social Security Benefits Inevitable? - Motley Fool
Social Security, often thought of as the “third rail” of American politics, is in the news a lot lately with most who are vying for a spot on the 2024 election slate vowing not to cut Social Security benefits. While its understandable why they would espouse that position for political purposes, to those who truly understand the nature of Social Security’s financial issues, it demonstrates a callous disregard for reality – unless Social Security reform is enacted soon, everyone’s Social Security benefit will be cut by 23% in about 10 years.
They all know this, but choose not to address it now to prevent voter backlash. But how about the backlash that will ensue if an across-the-board cut in benefits happens in 10 years? It’s time for our politicians to do what is right – reform Social Security and restore it to solvency for future generations. Various reform proposals are being discussed behind closed doors, with one side predictably favoring simply raising payroll taxes while the other side endorses reforms to address the root causes of the problem. The latter are often denigrated by opposing politicians and the media as wanting to “cut” benefits, conveniently omitting that such structural changes saved the program once before and will almost certainly be needed again for the same reason. Indeed, Social Security’s Trustees have warned Congress for decades that the program’s current structure cannot support future generations, but Congress has ignored those warnings. It’s time to come to grips with reality and admit, as this Motley Fool article by Trevor Jennewine so succinctly does, that “cuts” to Social Security may be inevitable.
As an example of the leading thoughts on reforming Social Security, the Association of Mature American Citizens (AMAC, Inc.) believes Social Security must be preserved and modernized. This can be achieved without tax increases by slight modifications to cost of living adjustments and payments to high income beneficiaries plus gradually increasing the full (but not early) retirement age. AMAC Action, AMAC’s advocacy arm, supports an increase in the threshold where benefits are taxed and then indexing for inflation, and calls for eliminating the reduction in people’s benefits for those choosing to work before full retirement age. AMAC is resolute in its mission that Social Security be preserved for current and successive generations and has gotten the attention of lawmakers in D.C., meeting with many congressional offices and staff over the past decade.