Question of the Day

If Congress had never changed the original Social Security Act of 1935, how much longer would the program stay solvent than the Social Security Administration's current best estimate?

Correct Answer

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If Congress had never changed the original Social Security Act of 1935, the program would have become insolvent before 1980. Contrary to the common belief that politicians have looted Social Security, they have actually extended its life by repeatedly raising its payroll tax rate, increasing its inflation-adjusted taxable maximum, and adding other taxes to the program. This has placed progressively higher Social Security tax burdens on successive generations of American workers. The Social Security Administration's current best estimate is that the program will become insolvent 12 years from now. Thus, the correct answer is 1980 minus 2034, or negative 54 years. To keep the program solvent after 2034 would require raising payroll taxes by another 28% starting in 2035, rising to a 35% increase by 2095. These shortfalls could also be covered by reducing benefits by 21% starting in 2035, rising to a 25% reduction by 2095.

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