Social Security gives expression to the principle “we are all in it together” and reflects the basic American values of hard work, personal responsibility, caring for family and neighbors, prudent management and respect for dignity and independence. Social Security beneficiaries earned their benefits by paying into the system throughout their time at work.   These values and Social Security’s fundamental structure, in place since 1935, have withstood the test of time.

Social Security provides a guaranteed income each year for more than 53 million American workers and their families who have lost income due to retirement, disability or death.  That’s nearly one family out of four.  

Nearly two-thirds of retirees count on Social Security for most of their retirement incomes.  It is a safety net that keeps retirees out of poverty. Between 1960 and 2008, Social Security helped cut the poverty rate among seniors by more than two-thirds, from 35 percent to just under 10 percent.  More than 1 million children—more than 15 percent of those who receive, or live in a family who receives, benefits—are kept out of poverty by Social Security.

The Social Security trust fund is fundamentally sound with a surplus that, according to both the Social Security Trustees and the Congressional Budget Office, will continue for years to come.  The trust fund is projected to grow from $2.5 trillion in 2009 to $4.2 trillion in 2024.  Social Security can meet 100 percent of its obligations through 2037.  And even if no changes are made, it can pay nearly 80 percent of scheduled benefits thereafter.

But something should be done.  Social Security should and can be strengthened for future generations with relatively modest adjustments that do not include benefit cuts.  The shortfall is manageable with the estimated gap between projected revenues and outlays only between 0.5 percent and 0.7 percent of GDP over a 75-year horizon.  The options for addressing the Social Security shortfall include a combination of the following:gradually raising the maximum taxable earnings base (“raising the cap”);  lifting the cap for employer contributions;  gradually raising the payroll tax rate over time;  applying the payroll tax to income from interest, dividends, capital gains and stock options;  and dedicating the estate tax to the Social Security trust fund, following the 2009 provisions, which tax only estates of more than $3.5 million ($7 million for couples).

With the decline in defined-benefit pensions, the dramatic increase in economic uncertainty and the loss of retirement savings for millions of Americans, strengthening Social Security’s core guarantee of retirement with dignity is more important than ever.