Overview of Social Security

Social Security was established in 1935 for the purpose of providing benefits to workers upon retirement, disability or to minor survivors if a parent has died. It is primarily funded through payroll taxes.

There are persistent concerns about the solvency of the program in future generations as percentage of retired Americans increases.

The proposals for modifying Social Security include: 1) Privatizing all or a portion of the program so workers manage their own investments, 2) making the program "means tested" and thus denying benefits to higher wage earners, 3) continuing to increase the retirement age, and 4) increasing Social Security taxes in particular by removing the cap (currently $125,000) that keeps high wage earners from continuing to pay payroll taxes.

Social Security has been a particularly popular program for American voters and they are resistent to any major change proposals.