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hiricinee t1_jc2w8g3 wrote

Reply to comment by ktxhopem3276 in [OC] US Social Security Fund History by PM_Ur_Illiac_Furrows

Right now the cap on the payroll tax is at around 150, very much to the point if wealthy people are living longer than means testing the benefits would reduce payments to them more. Of course the problem with that is that there's a lot less rich people than poor ones.

Also almost all of these ideas go against the principle of ss, which was to be a government sponsored retirement program you paid into and got out once you retired. Basically all of the ideas to fix it completely neglect that (out of necessity.)

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ktxhopem3276 t1_jc2x1pm wrote

Means testing is tricky because people will spend down savings faster to avoid it. The scary thing about means testing is it’s a slippery slope. We already have means testing sort of. When they added taxes on ss benefits in the 80s it was never inflation indexed. so now most people have to pay income tax on their benefits. Raising the cap brings in a lot more money than means testing according to the ssa analysis. Another possibility is to fix ss by shifting the medicare payroll tax to the ss trust fund so that ss is still a pay in to get benefits design. Medicare is only half funded by payroll taxes anyway and is mostly paid for by the general fund.

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thunder-thumbs t1_jc31zod wrote

If you remove the cap and remove the max payment, then that principle is retained, though, isn’t it?

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