Why Does Social Security Need Reform?

There are two basic reasons for Reforming Social Security:

1. A financial crisis:

• In just 15 years, by 2018, Social Security will begin to run a deficit spending more on benefits than it takes in through taxes.
• The IOU's in The Social Security Trust Fund will not solve the problem.
• Overall, Social Security is more than $25 trillion in debt.
• Without reform, Social Security taxes would have to be increased by 50 percent or benefits cut by one-third.

2. A bad deal:

• Social Security taxes are already so high that younger workers are receiving a low, below-marker return on their money.
• The average rate of return for workers today is barely 2 percent. Many young workers will receive 1 percent or less. Some will actually receiver a negative return-less in benefits than they pay in taxes.
• Raising taxes or cutting benefits will only make the problem worse.

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