Mr. Rother of the AARP writes, "If covered wages had remained the same percentage . . . the trust funds would have nearly $160 billion more in reserves today. . . would increase the life of the trust funds by about 10 more years."
The problem is funding the Social Security Trust Fund.
The Trust Fund is unfunded - or funded with government IOUs, if you like. To extend the life of the Trust Fund merely postpones and escalates the problem.
If we accumulate an unfunded Trust Fund of $3 Trillion, when we need to tap the Trust Fund, the Federal Government will have to raise taxes and/or cut spending by $3 Trillion - or issue $3T in new debt.
Obviously, raising the wage base should increase revenue - any tax increase should as long as it does not encourage greater tax avoidance. However, if the Trust Fund remains unfunded (i.e., un-invested) any benefit will be wasted.
