[Old_Mil]

The way that the will solve the problem is to institute confiscatory taxes on the social security payments of people who have saved a certain amount for retirement in their 401ks and IRAs.

The scale might look something like this: If your 401k or IRA balance is over 500k, your social security is taxed at 95%. If it is between 250k and 500k, it is taxed at 75%. Under 250k, current rates apply. Government beancounters will devise a way to essentially confiscate the social security benefits of a sufficient number of people to solve the problem, but not enough people to start a revolution at the polls.

[kabar]

The way that the will solve the problem is to institute confiscatory taxes on the social security payments of people who have saved a certain amount for retirement in their 401ks and IRAs.

No, they will solve it the same way they did in 1983 when SS went into a deficit. They raised the retirement age to 67, increased taxes, indexed the cap, and forced federal workers to join the system. This time around they will again raise the retirement age for full benefits, decrease the benefits for early retirement at 62 and/or raise the age, revise the formula to compute the annual COLA, and change the way benefits are computed further weighting it towards the lower end of the salary scale. They will also tax all SS. Both parties and the President will triumphantly declare that SS is now fixed and will be solvent forever, just like 20 years ago.

The 1983 Solution