To bring the Social Security system into fiscal balance, you have to increase revenue or decrease payouts, said Mike Tanner, senior fellow at The Cato Institute. “I think the answer there is to decrease payouts.” One way is to change the system’s benefits calculation from a wage growth model to an inflation-adjusted model. Merton Bernstein, an expert on Social Security and the Walter D. Coles Professor Emeritus at Washington University, advocates for pushing the payroll cap to cover 90% of total income instead of the current 84%. Increasing FICA 1% on employers and employees would enable Social Security to pay in full for the next 75 years, Bernstein said. “And that would not diminish real income because earnings are expected to exceed 1% a year from now into the indefinite future [once we are out of the recession].”

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