Social Security: Now What?

Social Security LogoWithin the Beltway, talk of tightening belts and signing any deficit reduction deal goes hand in hand with entitlement reform. Television talking heads and op-ed columnists continue to extoll the Simpson-Bowles plan, which includes cutting entitlements as one of its major policy planks, as a powerful fiscal remedy for America.

Those clamoring to cut social programs, led primarily by Republican deficit hawks such as Rand Paul (Sen-KY), have claimed that the American people want ‘more liberty and less government.’ Others have just thrown up their hands, complaining that Americans want public goods without paying for them.

Yet according to a survey by the nonpartisan National Academy of Social Insurance, the American public doesn’t just want to maintain Social Security but they’re willing to pay for it – personally.

Social Security

Most polls you saw during electoral season, leaked or conducted by Democratic campaigns, asked voters if they favored tax hikes on wealthy Americans to pay for our government’s bills. Unsurprisingly most Americans, not being personally affected by said tax hike, always replied in the affirmative.

What was particularly interesting about this survey is that it asked Americans if they agreed preserving Social Security would be worth raising Social Security taxes for not only wealthy Americans but also working Americans.  As the table below (taken from the National Academy of Social Insurance) demonstrates, 82% of Americans agreed that paying higher Social Security taxes would be worth keeping the program. 71% of Republicans and 97% of Democrats were also in favor of lifting the payroll tax cap on income (which is currently capped at $113,700).

At a time when the Beltway elite is considering ways to trim the Social Security bill, including by using a ‘chained’ Consumer Price Index (CPI) to determine Social Security’s cost-of-living adjustment (COLA), it would be important for Washington to know that there are other ways of keeping this popular program solvent.

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