Growing U.S. inequality is worsening Social Security's financial crunch, group says

TL;DR

Income inequality is a significant factor contributing to Social Security's financial strain, alongside demographic shifts.
The program's tax cap of $184,500 means that much of the faster income growth among high earners is not taxed by Social Security.
The share of total wages subject to Social Security taxes has fallen, largely due to high earners' incomes rising faster and exceeding the tax cap.
Eliminating or modifying the tax cap is proposed as a way to increase revenue and shore up the program's finances.
Social Security's trust fund is predicted to become insolvent by the end of 2032, which could result in a 22% reduction in benefits for beneficiaries.
In 1983, Social Security was overhauled with measures like increased retirement age and payroll taxes, but the wage cap was not adjusted to account for subsequent labor market shifts.
Real earnings for the top 6% of American workers rose significantly more than for the bottom 94% between 1983 and 2000, further impacting the tax base.

Continuer la lecture de l'article original