WASHINGTON – To avoid a shortfall in Social Security in less than 20 years, Americans are willing to retire later, pay more in payroll taxes and reduce benefits for the wealthy, according to a University of Maryland poll released Tuesday.
Donald Trump has said he won’t touch Social Security and will avoid the shortfall by growing the economy, which would increase payroll tax revenue. But a Center for American Progress analysis set to be released on Wednesday indicates Trump’s tax plans would lead to $1 trillion cuts in Social Security benefits over the next year without addressing the shortfall, senior CAP policy expert Rebecca Vallas said.
Hillary Clinton has promised to expand Social Security benefits and stem the shortfall by applying the payroll tax to all income through $250,000, up from the current $127,000. That could reduce the shortfall by 25 percent, according to the analysis from the liberal think tank.
In 2034, the Social Security Administration’s $2.8 trillion trust fund is projected to run dry due to the influx of baby boomers reaching retirement age. At that point, it will only be able to pay benefits equal to the revenue from the payroll tax, causing benefits to drop about 25 percent.
The University of Maryland Public Policy School and Voice of the People, based at Maryland and aimed it increasing citizens’ role in the legislative deliberations, conducted a unique poll to discover what Social Security reforms Americans would support. Researchers found bipartisan support for:
- Raising the cap on income subject to the payroll tax from $127,000 to $215,000
- Raising the retirement age to 68 years old
- Raising the payroll tax from 6.2 to 6.6 percent
- Reducing benefits for the top 25 percent of earners
The poll forced respondents to choose from a combination of reforms that could help eliminate the shortfall. A panel of experts Tuesday said the results showed voters are willing to make tradeoffs, with Republicans accepting higher taxes and Democrats willing to raise the retirement age if it meant maintaining Social Security.
“The bottom line is Americans like Social Security and they are willing to pay more to keep it,” said Kathleen Romig, senior policy analyst at the Center on Budget and Policy Priorities, which advocates to ensure equity for low-income Americans in fiscal policy.
But the experts said all of these reforms combined can’t solve Social Security. They pushed for lawmakers to address the problem soon because it generally takes years for reforms to create results. They estimated that Congress needs to pass a reform bill in about six years or the results won’t kick in in time to avoid some level of shortfall.
“I like to compare Social Security to the Titanic heading for an iceberg,” said. Romina Boccia, a budget expert at the conservative Heritage Foundation. “This program is too large to say, ‘Let’s just wait till [the iceberg] in sight and then do something.”
But such far-reaching legislation faces a divided, extremely partisan Congress and candidates whose plans provide either no fix or only a partial fix, the experts said.
“Our political discourse is trying to pretend we don’t have to make tough choices [on Social Security] and that’s a big problem,” said Marc Goldwein of the Committee for a Responsible Federal Budget.