That is exactly why the President wanted to reform social security but the dems and left leaning Republicans would not support him.
Yes. He is right on this issue. However, the Dems and huge special interest groups like AARP have effectively blocked any real reform by demagoging the issue and frightening people. SS has fatal structural flaws. The Dems want to keep FDR's "great" achievement going in its current form. It keeps the people dependent upon government.
Starting next year, the SS "surplus" starts declining and by 2017 it will be paying out more than it is taking in. Therefore, the politicians must do something. The last time this happened, in 1983, the politicians from both parties and President Reagan tweaked the system by raising the retirement age, decreasing benefits, and increasing taxes. It was supposed to make SS solvent for the next 70 years, yet just 34 years later, 2017, we will be faced with a much larger problem.
I fear the same thing will be done after the 2008 elections, i.e., kick the can down the road a little further without a permanent solution. The real solution is to phase in privatization of the system to eliminate the USG's unfunded $12.8 trillion unfunded liability. I doubt that is going to happen. Congress will raise taxes, decrease benefits, change the COLA formula, and means test some benefits just to keep the system going. And 20 years later the problem will be even bigger.
And Medicare is in even worse shape. It will need to be fixed with in the next five or six years. Together, Medicare/Medicaid/SS represent a total unfunded liability of over $65 trillion. The prescription drug program under Medicare, signed by Bush and passed by a Rep Congress, was a major mistake and added trillions to our liability. The US is headed for a major train wreck and very few politicians want to tell the American public how bad things really are.