Round-table panelists disagreed on what sorts of reforms should be taken or are politically feasible, with the more conservative panelists favoring benefit cuts and the more liberal ones, tax increases — particularly enhanced levies for the more affluent wage earners.
Messrs. John and Warshawsky advocate raising the age at which retirees may begin collecting their full Social Security benefits. (The current age for full benefits is 66; it rises to 67 for those born in 1960 or later. Retirees may begin drawing reduced benefits at 62.)
“We're seeing a substantial increase in longevity,” Mr. John said.
Mr. Warshawsky said the full-benefits retirement age should be indexed “to longevity thereafter.” He also supports increasing the early eligibility age and creating new retirement benefit programs for lower-income people, including one that would provide a match for their retirement contributions.
Said Mr. John: “It is nothing less than absurd to me that we have a situation right now where 50% of the workers can't save for retirement or receive a pension at their workplace.
“It makes very little sense to me where, on one hand, a lower-income individual is receiving a below-poverty benefit, while basically Bill Gates is going to get the same benefit that I get,” Mr. John continued. “That suggests to me that there's some changes that could be made here.”
Mr. Baker would eliminate the cap that currently limits the Social Security tax to the first $106,800 of income.
Ms. Altman said she would require people who make more than $106,800 a year to pay an additional week's worth of the payroll tax. She also advocated changes in the system to ensure a “special minimum benefit so no one retires under the poverty line.”
Ms. Reno also advocated raising the cap, “which could be very strongly justified on fairness grounds.”
But Cato's Mr. Tanner countered: “There's zero chance of that passing. There would not be a Republican vote in Congress to raise the cap.”
Mr. John said raising the $106,800 cap would “hurt an awful lot of middle-class individuals,” because about half of those earning more than $106,800 actually earn less than $130,000 annually.
“People are always quite delighted to raise somebody else's taxes when it comes right down to it,” Mr. John said. “It's not painless and it's not something that we can just simply dismiss as saying, 'Well, we are taxing the rich.' There's a real genuine consequence there.”
“Likewise, increasing the size of the payroll tax ... is especially going to hurt lower- and moderate-income workers because they're the ones who are basically going to be marginally priced out of jobs. It's a dangerous situation.”
Mr. Tanner's own fix would include slashing benefits. “We cannot ... pay the level of benefits that we have promised in the future,” Mr. Tanner said.