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Who Will Solve Social Security’s Financial Crisis? - Fortune
Congress has been kicking this can down the road for a long time. For several decades, the Trustees of Social Security have warned, in their annual report to Congress, that Social Security is facing a financial crisis. For many years, the Trustees predicted that crisis would occur in the mid-2030s – usually suggesting the year 2035. But recent Trustee reports have sounded the alarm even louder, now suggesting that Social Security will no longer be able to pay full benefit obligations as early as 2032.
Congress is the government body tasked with resolving this dilemma, but they have so far neglected to act. True, some proposal have been floated in the past, but what is actually required is a serious bipartisan Congressional effort, in consort with the President (who must enact any Congressional legislation), to reform Social Security and restore it to fiscal solvency. And it is the next generation of U.S. Senators who will be tasked with finally solving this long time issue, as explained in this Fortune magazine article by Eleanor Pringle.
As an example of leading thinking on reforming Social Security, the Association of Mature American Citizens (AMAC, Inc.) believes Social Security must be preserved and modernized to serve future generations. AMAC’s position is that this can be achieved without payroll tax increases through relatively minor program modifications, including changes to the cost-of-living adjustment (COLA) process and modifications to the formulas for calculating initial benefits for higher-income beneficiaries. Changes to the age for maximizing benefits are included in AMAC’s position, along with (1) an increase in the thresholds where benefits are subject to income tax; (2) indexing of these thresholds annually to account for inflation; (3) changing the taxable maximum formula to address the unintended loss of revenue; (4) improving survivor benefits, (5) eliminating the reduction in benefits for those choosing to work before full retirement age; and (6) improving savings tools for future retirees, including a savings account that builds estate value. 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. See AMAC’s proposal for Social Security reform here.