Why Social Security Needs a Fix in the First Place

Social Security’s combined trust funds are on track to be depleted in the next several years, at which point the program would only be able to pay out benefits from incoming payroll tax revenue — enough to cover roughly three-quarters of scheduled benefits.

That looming shortfall has pushed policymakers and think tanks to float a range of possible fixes, including raising the full retirement age, lifting or eliminating the cap on income subject to Social Security payroll taxes (currently capped at $184,500), and now, a new idea aimed squarely at how COLAs are calculated for higher earners.