WAHINGTON, D.C. — Anyone who works legally in the U.S. pays taxes into Social Security. It’s meant to provide benefits once we retire.
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But there are growing concerns about the possibility of that money running low in the next decade.
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We spoke with the new head of the Social Security Administration (SSA), Commissioner Martin O’Malley.
O’Malley has a lot to tackle. He’s facing staffing levels at a 27-year low, as the number of people receiving Social Security is at an all-time high.
“If for some reason Congress doesn’t act before 2034, then we will see roughly a 24 percent cut across the board to every beneficiary,” said O’Malley. Now, I don’t believe that’s going to happen. Congress has taken action every time we’ve approached an event like this in the past.”
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O’Malley said he’s optimistic Congress will again take the necessary action to make sure the program remains intact for future beneficiaries.
“Democrats and Republicans together have found enough votes to work it out and find a way forward,” said O’Malley about previous actions in Congress.
One change he said that can help: revising the tax code.
Currently, people are only taxed for Social Security up to $168,600.
That means while most workers are taxed for Social Security on their full income, higher earners are contributing a lower percentage.
“There are fixes to this,” said O’Malley. “It’s not rocket science and one of them is to ask wealthier earners to continue to pay into Social Security.”
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Many Democrats support raising the cap on taxable income for Social Security.
Republicans, meanwhile, have argued against raising taxes. Instead, a Republican budget proposal calls for making modest adjustments to the retirement age for future beneficiaries and lowering benefits for the wealthiest retirees.
As the debate over how to preserve the Social Security program continues, we asked O’Malley about his message to younger generations who may be concerned about their future benefits.
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“What I would say to younger people, and what I say to my own adult children, is that Social Security is not going bankrupt because it is a pay-as-you-go system,” said O’Malley. “As long as Americans keep working, there will always be money in Social Security.”
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