Congress has four levers at its disposal that it can pull to save the U.S. Social Security program. Martin O’Malley sees only one that needs pulling.
How can Social Security be fixed? This former commissioner says higher earning Americans need to pay more
The United States is fast approaching a similar situation in which it found itself in the early 1980s, the trust funds that support the Social Security program are headed for insolvency. If nothing is done by Congress to fix the situation, Social Security’s trustees say that the trust funds could run dry sometime in late 2032 or early 2033.
Since the program is a pay-as-you-go system, revenue from payroll taxes would still be paid as benefits to current recipients. But those only cover around 78% of scheduled payments, meaning that beneficiaries would see a haircut in the amount that they receive.
Fmr. SSA commissioner says Social Security tax rate is “unfair”
Lawmakers on Capitol Hill have four levers that they can pull to shore up the Social Security program, but former Social Security Administration Commissioner Martin O’Malley sees only one that needs pulling, raising taxes on the wealthy by removing the Social Security tax cap. “It’s only 6 percent of [Americans] that experience any benefit from the cap,” he said.
Currenly, in 2026, earnings are only taxed up to $184,500 to pay into Social Security. However, there have been calls to reapply Social Security taxes to incomes over $400,000. O’Malley added that he feels most people “think it is unfair that wealthy people don’t pay the same tax rate as a custodian in a school or a teacher.”
And he’s right in his reckoning. In a survey of Americans’ preferences for how to fix Social Security, the most popular option was removing the payroll tax cap for those earning above $400,000.
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