Social Security is on an unsustainable path. According to the latest projections, it will reach technical insolvency by 2032, threatening retirees with automatic 22 percent benefit cuts. The program is also a major driver of persistent federal deficits and mounting debt. Policymakers should not delay reforms any further and consider fundamentally rethinking the program’s structure—to protect seniors from old-age poverty, spare younger workers from higher tax burdens, and move the United States toward fiscal sustainability.
Cato’s Hub for Social Security Reform
Among all the ideas tested, one result stands out: Americans want to take politics out of Social Security. There is strong bipartisan support for tasking a commission of independent experts with reform.
Cato has developed a Social Security model to score a wide range of reform options. We welcome proposals from researchers, members of Congress, and federal agency staff. See this menu of Social Security policy options to get started.
If you have a proposal you’d like us to score, contact us at
Visual Feature
Social Security’s Financial Crisis: The Trust Fund Myth Uncovered
Most people misunderstand the Social Security trust fund. They believe it holds real financial assets that ensure future benefits—the equivalent of a piggy bank stuffed with dollar bills. But there’s a big problem: the piggy bank is empty.
Learn more in our latest interactive visual feature.
Payroll tax hike calculator
According to the 2026 Social Security Trustees Report, if Congress chose to close the program’s funding shortfall without reducing scheduled benefits, legislators would need to raise the combined Social Security payroll tax rate immediately and permanently from 12.4 to 16.65 percent. Using different assumptions, the Cato Social Security model estimates that the payroll tax rate would need to rise to 17.04 percent. The Congressional Budget Office (CBO) estimates the required rate at 17.31 percent in CBO’s 2025 Long-Term Projections for Social Security.
This interactive tool illustrates Social Security’s funding challenge by showing the payroll tax rates, and resulting annual tax burdens, that would be required to close the shortfall entirely through a payroll tax rate increase. Enter a yearly salary to see the total annual payroll taxes owed under each scenario, along with the difference from today’s tax burden.
Enter your yearly salary to see how payroll tax changes would affect you. Values range from $5,000 to $176,100.
Set the proposed Social Security payroll tax rate. The scale runs from the current rate of 12.4 percent up to the CBO estimate of 17.31 percent.
Social Security payroll taxes
The Social Security payroll tax applies to annual earnings up to $184,500 in 2026. Additional earnings beyond this level are not subject to the tax. The taxable earnings base grows automatically based on the national average wage index.
Featured Analyses: Cutting Through the Myths
Social Security is surrounded by myths that stand in the way of reform. Cato’s research dispels these misconceptions and outlines a path toward lasting reform.
Fast Facts and Commentary: The Raw Deal, Exposed
Social Security is an intergenerational income transfer program that’s becoming an increasingly bad deal for younger generations. Cato’s quick takes expose this dynamic and reveal the true scale of the program’s financial challenges in plain language.
Books and Deeper Research: Blueprints for Reform
Whether you’re a policymaker, scholar, or concerned citizen, this is essential reading for anyone who cares about the future of retirement in America.
