Republicans have resisted broad tax increases for decades. Social Security’s approaching insolvency may be testing that commitment.

The Washington Post recently reported that several prominent Republicans are becoming more receptive to raising taxes to avoid Social Security reform. While much of the current debate concerns raising or eliminating the limit on earnings subject to Social Security taxes, Rep. Tom Cole (R‑OK), chair of the House Appropriations Committee, said he is “willing to look at the [payroll] tax rate” and “willing to raise the amount of income through tax.”

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The newly released Social Security Trustees’ annual report shows that the Social Security Trust Fund’s finances have deteriorated further. The trust fund is now projected to be depleted sooner than previously expected, meaning Congress will face an even larger financing gap. Closing that gap will require larger tax increases, deeper benefit cuts, or some combination of both. 

Recent polling on Social Security from the Cato Institute in collaboration with YouGov offers some clues about how Americans are likely to respond to this news.

Americans are aware that Social Security is underfunded, but many do not understand the severity of the problem. For instance, 7 in 10 workers expect to experience some sort of Social Security benefit cut. However, when told that the Social Security budget shortfall would require benefit cuts of nearly 23 percent starting in the early 2030s, close to half (44 percent) conceded the situation was more serious than they previously thought. And the true share may be even higher, since some respondents may be reluctant to admit they did not already understand the problem. These results suggest many Americans will be surprised to learn that the trust fund is now projected to be depleted even sooner than expected.

Without Americans understanding Social Security’s dire fiscal situation, polls show they are highly resistant to meaningful reforms to close the shortfall. For instance, 77 percent oppose reducing Social Security benefits for current and future retirees, and 67 percent oppose reducing Social Security benefits for only future retirees.

At first glance, most say they would support increasing taxes to avoid benefit cuts for seniors. For example, majorities at first said they favor raising income taxes (58 percent) or payroll taxes “as much as necessary” (63 percent) to keep full benefits for retirees. 

Yet attitudes shift dramatically when discussing tax increases in concrete dollars and cents. More than three-fourths—77 percent—would oppose raising their own taxes even $1,300 per year, which is below what would be necessary for the average person to close the budget shortfall. 

Americans are also reluctant to raise taxes if doing so means current workers would not eventually get back what they paid into the system. Sixty-one percent (61 percent) would oppose raising taxes to maintain current seniors’ benefits if current workers would ultimately receive less than they paid in. Because Social Security is a pay-as-you-go system, higher taxes on current workers do not guarantee their own future benefits; instead, those taxes help finance benefits for current seniors.

The strongest public opening for breaking this political deadlock is an independent commission. Seventy-one percent (71 percent) of Americans favor Congress creating an independent National Commission composed of nonpartisan experts on Social Security reform and giving them the authority to solve Social Security’s budget problems. 

The public also supports several smaller changes that could improve Social Security’s finances, even if they would not actually solve the problem. For instance, 58 percent favor raising Social Security benefits at a slower rate in the future, and 57 percent would support holding benefits level for one year without any raise in benefits to build up funds, and 61 percent favor cutting benefits for higher earners to protect benefits for lower-income seniors.

Personal Accounts

The Cato Institute survey found broad initial support (60 percent) for allowing younger workers to invest some of their Social Security taxes into personal investment accounts.

But much of that support appears to depend on not fully recognizing Social Security’s pay-as-you-go structure. Social Security did not begin as a system in which each generation paid for its own benefits. The earliest beneficiaries paid little or nothing into the program compared with the benefits they received, creating a permanent financing obligation that later workers have been asked to cover ever since. That is why current workers’ payroll taxes fund current retirees, rather than being saved for workers’ own future benefits. 

As a result, allowing younger workers to opt out would leave fewer payroll tax dollars available to pay benefits for today’s seniors. Once respondents learn that allowing younger workers to opt out would require larger benefit cuts for current seniors, 69 percent oppose the proposal.

Members of Gen Z are the notable exception. Americans under 30 are the only age cohort in which a majority (55 percent) support allowing younger workers to opt out of Social Security even if doing so means benefit cuts for current seniors. This may be due to a plurality (48 percent) of younger respondents believing they get a worse deal than today’s retirees, or 79 percent who are expecting some sort of cut to their own future Social Security benefits.

Generational Conflict

When Americans are confronted with the generational conflict inherent in Social Security’s pay-as-you-go structure, younger Americans are more open to reform. Overall, 69 percent of Americans say “Social Security benefits should be protected for current retirees, even if that means higher taxes on younger workers,” while 31 percent say “younger workers should be protected from higher taxes, even if that means reducing benefits for current retirees.”

Gen Z Americans are the only age cohort that rejects higher taxes to maintain seniors’ current benefit levels. Instead, a majority, 53 percent, say current retirees should accept benefit cuts to protect younger workers from tax hikes.

Implications

The message from the Trustees’ report and the Cato survey points to the same conclusion: Social Security’s fiscal problems are serious, but the political problem may be even harder. The program’s financing gap is growing, yet Americans remain resistant to reforms necessary to close it. Americans know something is wrong, but many do not yet understand the scale of the trade-offs. Until they do, Congress will continue to face strong public resistance to serious reform.

Full topline results and methodology for the December Cato Institute 2025 Social Security National Survey can be found HERE and crosstabs found HERE. The full report can be found HERE.

Transgender federal inmates may soon face heart disease, diabetes, and broken bones — not from violence or neglect, but from a new federal policy deliberately tapering off their hormones. More than 600 inmates currently receiving hormone treatments could be affected. Recently, the Bureau of Prisons (BOP) published a program statement that goes even further than previous guidance: it promotes the use of psychotropic drugs to manage gender dysphoria, forbids inmates from receiving sex-modification surgeries, and tapers off all access to hormones.

Tapering will be physically dangerous. Says one physician specializing in transgender medicine: “We’re going to see an increase in the risk of cardiovascular disease events,” together with bone and metabolic problems. These risks are especially high for inmates who have had sex-modification surgery and whose bodies no longer naturally produce hormones the way other people’s do. Tapering will lead to heart disease, diabetes, and broken bones—not from neglect, but because the government straightforwardly disregarded those risks in banning treatment. 

Up until recently, the Trump administration’s policies on inmate gender transitions carried a certain logic. Shortly after his second inauguration, President Trump issued an executive order rejecting “gender ideology.” Among its provisions was a direction to the Bureau of Prisons (BOP) to “ensure that no Federal funds are expended for any medical procedure, treatment, or drug for the purpose of conforming an inmate’s appearance to that of the opposite sex.” Last summer, a federal court enjoined BOP from carrying out the order while a lawsuit challenging it is ongoing. BOP then issued the new program statement banning gender transitions outright.

Like the executive order, the new program statement has met with resistance. In a lawsuit, the ACLU is relying on the likelihood of physical injuries and psychological traumas to inmates to argue that both measures impose cruel and unusual punishment in violation of the Eighth Amendment. While the courts will have to work through that question, the Trump administration does have an appealing counterargument, especially as to inmates who have yet to start gender-transition treatments. Americans have strong moral disagreements about using drugs and surgery to carry out gender transitions, and respect for pluralism counsels against using taxpayer money to fund contentious procedures. Indeed, the Hyde Amendment reflected that principle in the abortion context for half a century: 1970s Democrats prohibited federal funding for abortions even while many defended the right to have one. They recognized that moral disagreement is a reason to avoid committing tax dollars to controversial procedures.

Breaking the logjam between transgender inmates and the Trump administration could involve a similar arrangement. This would require withdrawing BOP’s program statement, but not the president’s executive order, which simply holds that federal tax dollars will not fund gender transition treatments; it is the BOP statement that extends this prohibition to banning inmates from receiving these treatments altogether. A compromise would be to allow inmates to receive treatments funded by themselves and their supporters.

Precedent exists for inmates securing outside funding for practices the government will not pay for. In the context of religion, the Supreme Court stated in Cutter v. Wilkinson that while a prison cannot obstruct an inmate’s religious observance, it need not “pay for an inmate’s devotional accessories.” Likewise, federal courts have held that a Muslim prisoner cannot be forced to eat non-halal meat but can be required to pay for halal meat if he does not want to eat only prison-funded vegetarian meals—with help from outside donors.

A similar method could ensure inmate access to gender-transition treatment. Most states already require copays for inmate medical care, some of which family and friends help fund. BOP could establish a streamlined process for external contributions to cover gender transition treatments.

Inmate religious and gender accommodations do differ. Courts have proven skeptical about burdening inmates with more than minimal religion-associated expenses, given constitutional and statutory protections for that right, while sex-modification surgeries can be very expensive (as can hormone treatment, to a lesser degree). But inmates’ supporters and transgender mutual aid funds should be given the chance to fund these procedures even if the government won’t.

Ending federal funding of gender transitions is philosophically appealing and may prove legally justifiable. But an outright prohibition on adult inmates undergoing or even maintaining them is not. The Trump administration should withdraw BOP’s program statement and let inmates and their supporters fund gender-transition treatments with their own money.

Each year, the Treasury Department quietly publishes the Financial Report of the United States Government, a comprehensive assessment of America’s long-term financial trajectory. Unlike the Congressional Budget Office, which focuses on 10-year and 30-year economic and budget projections, the Financial Report evaluates the government’s long-term unfunded obligations.

The latest report shows that over the next 75 years, the federal government faces a $79.6 trillion gap between projected noninterest spending and revenues. In other words, projected spending commitments (excluding interest payments) exceed expected revenues by roughly 2.6 times the size of the entire US economy today.

Three Key Takeaways from the Financial Report:

• Social Security and Medicare account for more than the government’s entire $79.6 trillion long-term funding gap. Treasury estimates that total social insurance obligations exceed dedicated funding by about $88.4 trillion, almost all of which is attributable to Social Security and Medicare. A small share—about $0.1 trillion—comes from the Railroad Retirement and Black Lung programs. This means the rest of the budget is running an $8.8 trillion surplus.
• The US fiscal trajectory is rapidly worsening. Federal debt is already roughly equal to the size of the economy and continues to grow indefinitely under current law. The debt-to-GDP ratio is projected to rise from 102 percent in 2026 to 200 percent by 2048 and to 576 percent by 2100. 
• Delaying necessary policy options comes at a high price. Closing the fiscal gap—defined as stabilizing the debt-to-GDP ratio over 75 years—would require an average annual primary (noninterest) deficit reduction of 4.7 percent of GDP, assuming Congress acts immediately. Delaying action until 2036 or 2046 raises the required reduction to 5.6 percent and 6.9 percent of GDP, respectively.

Social Security and Medicare Must Be Reformed

The most important finding in the Financial Report is that the long-term fiscal imbalance is driven primarily by Social Security and Medicare.

Over the next 75 years, projected spending on these programs exceeds their dedicated revenues by a wide margin. Social Security is primarily financed through payroll taxes on current workers, with benefits paid out to current retirees, while Medicare relies on a mix of payroll taxes (for hospital insurance), general revenues, and beneficiary premiums. These financing structures were not designed to support the scale of benefits promised under current law, especially as the population ages and fewer workers support more retirees. 

Treasury estimates that total social insurance obligations exceed dedicated funding by about $88.4 trillion, including $27.9 trillion for Social Security, $60.4 trillion for Medicare, and $0.1 trillion for the Black Lung and Railroad Retirement programs (see chart below).

The overwhelming takeaway: there is no realistic path to fiscal solvency that avoids reducing spending on the major entitlement programs. Suggesting otherwise is delusional.

Congress should reform Social Security and Medicare to better align benefits with available resources, focusing on slowing spending growth rather than burdening younger Americans with ever-higher taxes. This includes gradually increasing the retirement age to reflect longer life expectancies, targeting benefits more effectively to seniors in need, reducing excessive Medicare subsidies that drive up costs, and empowering patients to purchase insurance and health care services directly to improve incentives. 

Delaying these changes will only force more abrupt and disruptive adjustments later.

Debt Is on a Disastrous Path

The Financial Report depicts a clear picture that current fiscal policy is unsustainable.

Federal debt is already near 100 percent of GDP. Under current policy, it continues to rise faster than economic growth. While there is no precise threshold at which debt triggers a crisis, continued increases in the debt-to-GDP ratio reduce economic growth by crowding out private investment, impose higher borrowing costs by driving up interest rates, and compromise the government’s ability to respond effectively to an unexpected crisis.

Closing the fiscal gap requires significant policy changes: most importantly, slower spending growth. The longer policymakers wait, the larger the required adjustments become. Delaying reforms requires sharper changes later, concentrating the burden on fewer cohorts and limiting legislative policy options.

Higher inflation becomes the path of least resistance the longer legislators procrastinate on making the economically necessary changes that are politically difficult.

The fiscal gap is useful in this respect, summarizing both the size of the imbalance and the cost of postponing action. Congress can solve the problem by immediately reducing annual deficits by 4.7 percentage points of GDP. Delaying action until 2036 or 2046 raises the required reduction to 5.6 percent and 6.9 percent of GDP, respectively.

Why the Report Receives Little Attention

The Financial Report receives limited attention in Washington and in major media coverage. Its central implication—that Social Security and Medicare drive the long-term imbalance—is politically inconvenient. Instead of addressing the problem, Washington’s fiscal debate has become a performance: acknowledge the debt and avoid the solution.

The report makes clear that rising debt is not a temporary problem. It is the result of unsustainable policy choices. Chief among them: bestowing lavish benefits on older, more politically active Americans financed by borrowing that shifts the cost to younger, less politically active generations.

Stabilizing the debt will require changing the trajectory of Social Security and Medicare by slowing their unsustainable spending growth. Delay only increases the size of the adjustment and raises the risk that Congress will rely more heavily on tax increases to avoid sudden and disruptive benefit changes.

A 3 Percent of GDP Deficit Target to Restore Sustainability

Congress is considering a 3 percent of GDP deficit target—a useful benchmark for signaling fiscal discipline and restoring credibility. But a target alone is not enough.

To be effective, it should be paired with a mechanism capable of producing politically difficult reforms, such as a BRAC-like fiscal commission. Without such a process, targets risk becoming aspirational rather than binding. Done right, a 3 percent deficit limit, backed by an actionable reform mechanism, could help put the federal budget on a more sustainable path.

Reforming Social Security and Medicare is key to stabilizing the growth in the debt.

Join us on May 6, 2026, at 10 a.m. for the event: Social Security in the Red: Implications for Federal Debt. Register here.
 

The Cato Institute recently conducted a nationally representative Social Security survey of 2,000 Americans, exploring their attitudes toward the program, their understanding of how it works, and their openness to potential proposals aimed at addressing its long-term shortfalls.

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.

Americans Want a Fiscal Commission

Seventy-one percent (71 percent) of respondents favor creating a commission of independent experts to address Social Security’s funding shortfalls. Support is broad across age and income groups, with Democrats most supportive (78 percent), followed by Independents (72 percent), and Republicans (68 percent). The survey explicitly asked:

Would you favor or oppose Congress creating a National Commission, composed of independent, non-partisan experts, on Social Security reform and giving it the authority to solve Social Security budget problems?

This proposal is inspired by the Base Realignment and Closure (BRAC) process, which successfully closed obsolete military bases after the Cold War. The process was necessary because, even as members of Congress recognized the need for base closures, they tried to protect their districts from being affected and banded together to keep any base from closing.

The BRAC model overcame this barrier through two key design features.

First, it relied on commissions composed solely of independent experts, excluding members of Congress. This removed the decision from parochial concerns. The expert commissions drafted a package of recommendations, which was then sent to the president for approval and, if approved, sent to Congress for review.

Second, the recommendations automatically became law unless both the House and Senate passed a joint resolution of disapproval. Lawmakers couldn’t propose amendments and didn’t need to take affirmative votes: they could only reject the entire package, a much higher bar for blocking reform.

By excluding politicians from the recommendation-drafting stage and eliminating the need for lawmakers to actively vote on politically sensitive changes, the BRAC process shifted responsibility—and blame—to independent experts and made reform possible.

Boccia has written extensively on applying the BRAC model to fiscal policy. A BRAC-like fiscal commission could be tasked with addressing America’s alarming fiscal trajectory, including through Social Security reform. Its defining features, insulation from politics and fast-track authority, give it a far greater chance of succeeding where previous commissions with similar goals have failed.

Broad-based support for an expert commission likely reflects deep dissatisfaction with Congress’s handling of Social Security. Sixty-two percent of respondents believe Congress has mostly broken its promises to workers in managing the program, a view shared across age groups and party lines. This perception could stem from the common view that Congress “raided the trust fund” and used workers’ payroll taxes for purposes other than Social Security (this perception wasn’t tested in the survey).

Other Takeaways from the Survey

Beyond strong bipartisan support for a commission of independent experts, the survey reveals additional insights: younger adults are more open to benefit reforms, most Americans don’t want the payroll tax increases that would be required to avoid benefit reductions, and there is meaningful support for certain benefit reforms. Below is a brief summary of these key takeaways (for a more detailed breakdown of the results, see the analysis from Cato’s Emily Ekins and Hunter Johnson):

• Young Americans are more open to benefit reductions: While 77 percent of all adults oppose reducing benefits for current and future retirees to address Social Security’s funding shortfalls, young Americans (the 18–29 age cohort, or Gen Z) are much more supportive, with nearly half (47 percent) favoring this change (see chart below). Younger workers, who are already paying a significant share of their paychecks for significantly wealthier retirees’ benefits, are understandably reluctant to give up an even larger share of their earnings.
   

• Americans support higher taxes—until they learn the price: While many Americans initially say they would support raising payroll taxes “as much as necessary,” that support collapses once the question is framed in dollars (see chart below). Across age, income, and party lines, most Americans are unwilling to pay anywhere near what would be required to fix Social Security through higher payroll taxes alone (a payroll tax increase from 12.4 to 16.7 percent). For context, a median full-time earner would need to pay roughly $2,600 more per year if Congress raises the payroll tax rate to 16.7 percent. Meanwhile, more than three-quarters of Americans wouldn’t be willing to pay half that amount to shore up the program.
   

• Americans support meaningful benefit reforms: Nearly half of all adults (48 percent) favor replacing Social Security with a flat-benefit system that raises lower earners’ benefits and reduces those of higher earners, with younger cohorts significantly more likely to support this change (see chart below). Additionally, one of the most popular reform options is slowing the growth of Social Security benefits, with 58 percent of respondents favoring this approach, which could generate substantial long-term savings. Congress could switch to indexing initial benefits to inflation instead of wage growth, which would close 74 percent of the funding shortfall, without cutting anyone’s benefits, simply by slowing benefit growth.
   

Taken together, the survey shows that Americans are open to Social Security reforms that deliver meaningful savings while avoiding higher taxes and additional borrowing. But regardless of its merits, any reform path will create winners and losers, making it politically sensitive and difficult for Congress to advance. That reality makes the case for a BRAC-style commission compelling, especially given the strong public support for this idea. By delegating Social Security reform to independent experts and insulating the process from political pressures, Congress could finally break the political gridlock that has stalled action for decades and put the program on a sustainable path.

Many developed countries have relied on commissions to guide retirement reforms, including Germany, New Zealand, and Sweden. We explore their reform experiences and retirement systems in depth in our new book, Reimagining Social Security: Global Lessons for Retirement Policy Changes.

Get your copy here

I don’t know. It feels like we’re paying into this system that was designed for a completely different world. I mean, it was set up 90 years ago, and the way things are going now, it just doesn’t add up anymore. People are living longer, fewer workers are supporting more retirees, and the debt is skyrocketing.

That’s Amanda—a fictional 35-year-old nurse, wife, and mother—speaking in the opening pages of Reimagining Social Security: Global Lessons for Retirement Policy Changes, released today by the Cato Institute. Her story reflects the growing anxiety among younger workers, who are paying into a system increasingly out of step with today’s demographic and economic realities.

The book’s release comes just two days before Social Security’s 90th anniversary. As Social Security’s debt burden continues to grow, the cost of maintaining the program threatens to limit opportunities for Amanda’s generation and the ones to follow. Higher taxes, reduced benefits, and an uncertain economic future loom large if no reforms are made.

Readers of the book will discover overlooked facts and surprising comparisons that underscore the urgency of reform and the need to reimagine the program for the 21st century. 

For instance:

• While much of the focus is on Social Security’s insolvency date of 2033, the program has been running cash-flow deficits since 2010. To cover these shortfalls, the government borrowed more than $1 trillion from 2010 to 2023. Between 2024 and 2033, Social Security is projected to add more than $4 trillion to federal deficits (including interest costs). 
  
  Over the next 75 years, the program has an unfunded obligation of $25 trillion, comparable to the size of the entire publicly held debt of $28 trillion in 2024. Our recent visual feature brings all of this to life.
• Seniors who receive Social Security benefits are significantly wealthier than the workers who fund those benefits—Americans aged 65–74 have three times the median net worth of those aged 35–44: $410,000 vs. $136,000.
• Compared to other nations examined in the book, Social Security provides substantially larger benefits. For example, Social Security’s maximum benefit at the full retirement age ($48,216) is more than three times higher than Canada’s ($14,568), more than twice as high as New Zealand’s ($21,475), and more than three times the US poverty threshold for a single senior in 2024 ($15,045). For those retiring at age 70, the maximum benefit rises to $61,296—more than four times the poverty threshold.
• According to the Internal Revenue Service, the largest share of Social Security payments in 2022—about 34 percent—went to individuals with an adjusted gross income of more than $100,000 (see figure below).

For workers like Amanda, these realities fuel a growing sense of disillusionment. But it doesn’t have to be this way.

Our book offers real solutions. It draws lessons from four countries that have reformed and modernized their pension systems: Canada, Germany, New Zealand, and Sweden. While no system is perfect, their reforms hold important takeaways for the United States:

• Flat benefits can better target poverty at a lower cost.
• Aligning retirement ages with life expectancy improves program sustainability and protects younger generations from rising tax burdens.
• Automatic stabilizers correct for changing demographics and keep pension systems solvent without political delays.
• Universal savings accounts (USAs) would empower workers to save for retirement and other priorities with greater flexibility.

Reimagining Social Security presents bold, evidence-based ideas to protect younger workers like Amanda from rising tax burdens and mounting debt while supporting the most vulnerable seniors.

Order your copy now

Save the date for two of our upcoming events:

• Exclusive subscriber chat – Happening in early September, this online discussion will dive into the book’s key insights with the authors. It is open to Debt Dispatch paid subscribers, congressional staff, federal agency personnel, and active Cato donors. Register here.
• Book launch event – Join us on October 30 at the Cato Institute headquarters in Washington, DC, for a special launch event featuring leading experts in fiscal and retirement policy. You’ll also be able to watch the event live online. More details are coming soon.

55% of Americans don’t know how Social Security is funded, 79% don’t believe they’ll receive their full benefit in retirement

The Cato Institute’s August 2025 Social Security Survey of 2,200 Americans, conducted by Morning Consult, reveals that many Americans are deeply confused about how Social Security works, what it’s for, and what the future holds. Despite the program’s central role in retirement planning, the public lacks a basic understanding of how it’s funded or how much it pays.

FULL POLL RESULTS HERE

Over half of Americans (55%) don’t know how Social Security is funded. Less than half (45%) know that today’s workers pay for current retirees, and that future workers will pay for their benefits when they retire. Nearly a quarter (23%) believe that their Social Security taxes are saved in a personal account for them. Another third (32%) say they don’t know how Social Security is funded. 

A majority of Americans (55%) believe the main purpose of Social Security is to replace seniors’ income. Less than half, 45%, believe the program is to ensure that seniors don’t fall below the poverty line, which is how the program was originally intended. 

Partisans have similar views, although Democrats are somewhat more likely than Republicans to think Social Security is an anti-poverty program (48% to 41%) and Republicans are somewhat more likely than Democrats to think it’s an income replacement program (59% to 52%).

An overwhelming majority of nonretired adults (79%) do not believe they will receive their full scheduled Social Security benefits when they retire. About one in ten (13%) go even further, saying they expect to receive nothing at all. 

Many Americans would be surprised to learn that American seniors have more wealth than middle-aged Americans. Indeed, the survey found that only 26% know that Americans ages 65–74 have on average more wealth than Americans ages 35–44. A majority (74%) think that either seniors have less wealth (43%) or that they have the same amount of wealth (31%) as those 35–44 years old.

Most (60%) understand that workers who paid more into Social Security get higher benefits than those who paid in less. Fifteen percent think all retirees receive the same benefit, and 25% aren’t sure.

However, there are considerable knowledge gaps pertaining to the actual amounts disbursed. Ninety-one percent of Americans did not know that the highest annual Social Security benefit can reach $60,000 a year. When it comes to estimating the average benefits Americans receive, only 25% correctly answered that the average benefit is $20,000–$29,000 per year.

Overall, 38% underestimated the average Social Security benefit people receive, 17% overestimated the amount, 25% selected the correct answer, and 19% weren’t sure.

Social Security’s Future Solvency

Over the past decade, Social Security has paid out more in benefits than it collects in taxes from current workers. Government analysts project that if Congress does nothing, all Social Security benefits could be cut by about a quarter starting in 2033. The survey found that most Americans are aware of the program’s looming financial challenges. 

About three in four adults (77%) have heard that Social Security is projected to run short of money by 2033. Among seniors aged 65 and older, awareness is even higher, with more than nine in ten (93%) having heard about the shortfall.

Americans are evenly divided about how to address the Social Security program’s 2033 shortfall. A little more than a third (37%) believe taxes should be raised, fewer (28%) think benefits should be cut, and a remarkable 35% felt Congress should just borrow the money. 

Support for a Flat Benefit

To avoid tax hikes or benefit cuts, a plurality (38%) of Americans would support switching to a flat Social Security benefit of about $1,800 a month for all retirees regardless of their prior earnings. This would require lowering benefits for high earners and increasing benefits for low earners compared to what they get now. A little more than a quarter (28%) would oppose this change, and 34% aren’t sure either way.

Support declines when framed in terms of equality of benefits. Slightly more oppose (35%) than support (32%) switching to a flat monthly benefit when framed as giving everyone the same benefit regardless of how much they contributed to the system.

The results suggest Americans may be open to replacing Social Security’s earnings-based formula with a flat benefit for all. However, support for this change appears conditional; many are skeptical unless the alternative is broad benefit cuts or tax increases.

Partisans Align on Flat Benefits

Notably, Democrats and Republicans had very similar views and knowledge gaps about Social Security. For instance, majorities of both Democrats and Republicans didn’t know how Social Security is funded (53% and 50%, respectively), and think that its purpose is to replace incomes (52% and 59%) rather than prevent poverty (48% and 41%), or offers benefits as high as $60,000 annually (91% and 91%). Unsurprisingly, Democrats were slightly more likely than Republicans to favor raising taxes (44% vs. 34%) and Republicans slightly more likely than Democrats to support cutting benefits (32% vs. 24%) to address the Social Security shortfall. 

Remarkably, however, both Democrats and Republicans almost equally supported the idea of a flat benefit. Forty-four percent of Democrats and 40% of Republicans support the idea of changing Social Security so that all retirees get the same monthly benefit of about $1,800 a month to avoid tax increases and benefit cuts (and 29% and 34% opposed, respectively). Similarly, both Democrats (35%) and Republicans (36%) supported the idea when framed in terms of equality of benefits regardless of prior earnings.

Generational Gap

Younger Americans and older Americans have highly divergent views and knowledge about Social Security. Americans aged 18–29 are more likely than seniors to mistakenly believe that Social Security taxes are saved in a personal account for them (34% vs. 17%), and much less likely to correctly understand that their taxes fund current retirees (25% vs. 66%). 

Generational perspectives also differ on the role of Social Security. More than half of Gen Z respondents (53%) view it primarily as a poverty protection program for seniors. Meanwhile, 60% of Baby Boomers see it as a system designed to replace income in retirement.

Younger Americans also show greater openness to reforming Social Security. When asked how they would respond to the projected depletion of Social Security funds in 2033, nearly half of Gen Z respondents said they would prefer cutting benefits (49%) to raising taxes (20%), while a majority of Baby Boomer respondents favored raising taxes (52%) to cutting benefits (13%). 

This generational divide continues with proposals to restructure Social Security into a flat benefit system: Young adults support the idea (44% vs. 22%). In contrast, the majority of seniors oppose it (44% vs. 30%).

Conclusion

These findings reveal not only widespread confusion about how Social Security works, but also a surprising openness to reform, especially among younger Americans. As the program approaches financial shortfall, policymakers may find that the public is more willing to consider significant changes than previously thought, particularly if those changes are framed as necessary to avoid painful tax hikes or benefit cuts.

The Cato Institute August 2025 Social Security Survey was designed and conducted by the Cato Institute in collaboration with Morning Consult. Full topline results can be found HERE and crosstabs found HERE. Morning Consult collected responses online July 19–21, 2025, from a national sample of 2,200 Americans 18 years of age and older. Restrictions are put in place to ensure that only the people selected and contacted by Morning Consult are allowed to participate. The margin of error for the survey is +/- 2 percentage points at the 95% level of confidence.