Serious Time

[Lamplighter]

Back to the Soc Sec deficit... here is a short version of the Committee's recommendations (as part of an NY Times "opinion" piece)

Bolding is mine.
I personally would not trust the Republican Co-Chairman of this Committee,
so I started out as very sceptic over any report he might support,
but seeing this short version of the components makes me think there might be something to it, after all !



Safer Social Security
By PETER ORSZAG
Published: November 14, 2010

Social Security is not the key fiscal problem facing the nation.
Payments to its beneficiaries amount to 5 percent of the economy now;
by 2050, they’re projected to rise to about 6 percent.
Over the same period, federal health care costs will increase six times as much.

The proposal put forward last week has four main elements.

First, it would make the payroll tax more progressive by increasing the maximum earnings level...
<snip>Today, about 15 percent of total wages are not taxed.
The chairmen recommend gradually raising the maximum threshold so that, by 2050,
only 10 percent of total wages wouldn’t be taxed —
decreasing the 75-year Social Security deficit by more than a third.

Second,<snip>indexing the age at which full Social Security benefits can be received to increases in life expectancy.
This age is already increasing to 67, and under the proposal the gradual rise would continue, to 68 by 2050.
<snip>But the chairmen’s approach would by itself narrow the Social Security gap by about a fifth.

The third suggested change is to <snip> by reducing future payments to high earners
while increasing them for people at the bottom.
These adjustments would close at least another third of the projected deficit.

Finally, <snip> have Congress adjust the cost-of-living index t<snip>so that it would measure inflation more accurately.
Making this switch would fill in more than a quarter of the long-term deficit, because the new index would grow more slowly.

If Congress were to take all four of these recommended step,
it could not only eliminate the long-term deficit in Social Security
but also make the system much more progressive.<snip>
Furthermore, the plan would not create private accounts within Social Security —
the most controversial issue that came up when reform was last debated in 2005.