The Social Security Administration writes: The number of retired workers is projected to grow rapidly starting in 2008, when the members of the post–World War II baby boom begin to reach early retirement age, and will double in less than 30 years. People are also living longer, and the birth rate is low. As a result, the ratio of workers paying Social Security taxes to people collecting benefits will fall from 3.3 to 1 in 2007 to 2.1 to 1 by 2034. The Trustees Report projects that in 2017, when the ratio will be 2.7, there will not be enough workers to pay scheduled benefits at current tax rates. The Trustees Report also projects that redemption of trust fund assets will be sufficient to allow for full payment of scheduled benefits until 2041.
However, David C. John, a Research Fellow at the Heritage Foundation, a conservative think tank, writes: The Social Security trust fund is really only an accounting mechanism. The trust fund shows how much the government has borrowed from Social Security, but it does not provide any way to finance future benefits. The money to repay the IOUs will have to come from taxes that are being used today to pay for other government programs. For that reason, the most important date for Social Security is 2018, when taxpayers must begin to repay the IOUs, not 2042, when the trust fund is exhausted….The debate about Social Security’s future should be about how to improve each American’s personal retirement security and how to enable each American to build a nest egg for the future. Otherwise, Americans will lose a real opportunity to improve the lives of future retirees. The best way to fix Social Security is to provide younger workers with the opportunity to invest part of their Social Security taxes in personal retirement accounts. http://www.heritage.org/
John McCain advocates supplementing Social Security benefits with individual investment accounts. When asked about Social Security during a GOP debate, he stated: Every man, woman, and child in America needs to know it’s going broke, and we’ve got to do the hard things. We’ve got to fix it for the future generations of Americans…It’s got to be bipartisan. And you have to go to the American people and say we won’t raise your taxes. We need personal savings accounts, but we have to fix this system.