They are woefully insufficient to the daunting task of protecting the Social Security system from all-out failure. By 2013, when boomers will be retiring en masse, the amount of benefits being paid will finally exceed the amount of payroll taxes being collected. In 2020, the fund's interest income will be insufficient to cover the shortfall, and the bonds that represent the Social Security surplus will have to be redeemed for cash. As the fate of the Social Security system continues to be hotly debated, solutions ranging from modest to radical have been suggested. Payroll taxes could be raised over the next decades to cover the shortfall.
Estimates vary as to how great an increase is needed.
It is highly unlikely that Congress will raise taxes for Social Security without also considering other changes in the benefit structure. Another possibility, considering the average American s increased longevity from 65 in the 1930s to 76 in the 1990s, would be to raise the retirement age. In order to provide the same number of years of retirement benefits in 2030 that were originally contemplated when Social Security was launched, the retirement age would have to be raised from 65 to 74. There is also the possibility of means testing for Social Security recipients. Elderly Americans now have the highest level of per capita household wealth of any age group.