Social Security is on an unsustainable path. According to the latest projections, it will reach technical insolvency by 2033, threatening retirees with automatic 23 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
Featured Event
Social Security in the Red: Implications for Federal Debt
Social Security is widely portrayed as a self-financed program with a long-term trust fund solvency problem. But for more than a decade, the program has already been financed in part through federal borrowing. The trust fund is a political construct, not a true repository of savings or investments. Since 2010, the Treasury has borrowed more than $1.5 trillion to pay Social Security benefits, and borrowing is projected to rise sharply even before the trust fund is exhausted in 2032. Over the next 75 years, the program’s cash-flow shortfall will exceed $28 trillion in present-value terms.
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 latest report from the Social Security Trustees, Congress would need to raise the payroll tax rate immediately and permanently from 12.4 to 16.05 percent to close the program’s funding shortfall.
This interactive tool shows how much your annual Social Security taxes would rise under such an increase. Enter your current yearly salary to see the difference.
Enter your yearly salary to see how payroll tax changes would affect you. Values range from $5,000 to $176,100.
Social Security payroll taxes
Note: The Social Security payroll tax applies only to annual earnings up to $184,500. Additional earnings beyond this level are not subject to the tax.
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.
