There are just 13 years before Social Security may not be able to pay full benefits, according to a recent annual report from the program’s trustees.
In 2035, just 80% of benefits will be payable if Congress doesn’t fix the program sooner.
Shoring up the program will generally mean raising taxes, cutting benefits or a combination of both. Democrats have floated several proposals to increase benefits and raise taxes, including one House bill they hope to bring up for a vote this year. Republicans have expressed their opposition to their plans.
Despite the Washington gridlock, the University of Maryland’s Program for Public Consultation found there are a host of changes public voters who lean either Republican or Democrat may be able to stomach.
The program conducted a public consultation survey of 2,545 registered voters between April 11 and May 15.
The questions were presented as a policy-making simulation, according to Steven Kull, director at the Program for Public Consultation at the University of Maryland.
The options were presented one at a time, with pro and con arguments that have been vetted by experts on both sides of the aisle. Each choice included gradations and the potential impact on the program’s shortfall.
Respondents tended to spread their choices to include some revenue increases and some budget cuts, according to Kull. Most didn’t max out one side or the other.
Here are seven fixes Americans say they are are willing to make, starting with the most popular:
1. Raising the Social Security payroll tax cap
- Share in support: 81%
- Democrats in support: 88%
- Republicans in support: 79%
Raising the payroll tax cap is the one proposal that got “overwhelming bipartisan support,” according to Kull.
In 2022, Social Security payroll taxes are applied on up to $147,000 in income, a level that is adjusted each year. That means high earners may pay Social Security payroll taxes for just part of the year.
However, one Democratic proposal — Social Security 2100: A Sacred Trust put forward by Rep. John Larson, D-Conn. — calls for reapplying those payroll taxes for wages of $400,000 and up. Another bill proposed by Sens. Bernie Sanders, I-Vt., and Elizabeth Warren, D-Mass., calls for a $250,000 threshold, plus additional taxes on capital gains, and net investment and business income.
Increasing the level of income at which Social Security payroll taxes are reapplied to income of more than $400,000 would eliminate 61% of the shortfall, researchers estimate. The proposal is popular with the public, having earned its own slogan, “Scrap the Cap.”
2. Reducing benefits for high earners
- Share in support: 81%
- Democrats in support: 86%
- Republicans in support: 78%
Wealthier retirees generally receive more generous benefits, even though they likely have more ways to fund their retirements, such as through pensions and savings. Means testing benefits for those with certain wealth or income could be another way to help reduce the program’s shortfall.
This would reduce the amount of benefits the top 20% of earners receive, and would reduce the shortfall by 11%.
3. Gradually raising the retirement age
- Share in support: 75%
- Democrats in support: 76%
- Republicans in support: 75%
Your retirement age is when you stand to get the full benefits you earned based on your work record. Increases to the retirement age that were enacted in 1983 are still getting phased in today. For people born in 1960 or later, the full retirement age is 67.
As many people work and live longer, some argue that the retirement age should be raised again. However, advocates for expanding Social Security are firmly against this benefit cut. Washington Democrats’ proposals largely exclude this change.
Such a move would reduce an estimated 14% of the shortfall.
4. Increasing the payroll tax
- Share in support: 73%
- Democrats in support: 78%
- Republicans in support: 70%
Currently, employers and employees each pay a tax of 6.2% of wages, and raising those rates could have a big impact on the program’s solvency. The simulation called for raising that to 6.5%, which would help eliminate 16% of the shortfall.
A previous version of the Social Security 2100 Act put forward by Rep. John Larson, D-Conn., proposed raising payroll tax rates for both workers and employers up to 7.4% each from its current 6.2%. That change would have been phased in gradually over more than 20 years. This would cost just 50 cents more per week for the average worker who earns $50,000, according to the proposal.
While Larson compared it to the cost of a cup of coffee, Republicans bristled at the prospect of passing down higher tax rates to younger generations. The new Social Security 2100 Act no longer increases the payroll tax rate.
5. Raising the minimum benefit
- Share in support: 64%
- Democrats in support: 71%
- Republicans in support: 59%
For people who rely solely on Social Security benefits for income in retirement, surviving on the minimum benefit can be difficult. Sanders and Warren have proposed a bill that calls for making the minimum benefit indexed to 125% of the federal poverty line. Likewise, Larson’s bill also seeks to raise the minimum benefit.
That change would bring the minimum benefit for someone who has worked for 30 years up to $1,341 from $951, thereby increasing the shortfall by 7%.
6. Changing cost-of-living adjustment calculations
- Share in support: 55%
- Democrats in support: 59%
- Republicans in support: 55%
Social Security benefits are currently adjusted every year based on a subset of the Consumer Price Index, which measures changes in the prices consumers pay over time. Beneficiaries saw a record 5.9% increase in 2022, and are poised to see an even bigger boost to benefits in 2023.
Yet many argue the measure used, the Consumer Price Index for Urban Wage Earners and Clerical Workers, or CPI-W, is not the best gauge of the costs retirees pay. Democratic proposals all call for replacing that measure with the Consumer Price Index for the Elderly, or CPI-E.
That change would increase the shortfall by 12%.
7. Increasing benefits for beneficiaries over age 80
- Share in support: 53%
- Democrats in support: 56%
- Republicans in support: 53%
Increasing benefits for beneficiaries over age 80 by 5% would increase the shortfall by 5%. To be sure, benefit increases would not help the program’s funding woes. But they may help ensure retirees can cover their costs for the duration of their retirement.
The goal of the survey is not to take a partisan side, according to Kull.
“We don’t take a position except the position that the public should be heard,” Kull said.
“The public very strongly wants this,” he said of the results.