That Millions of Retirees Support Cutting Social Security Benefits Now: Makes Perfect Sense

A recent poll found that most Americans would agree with cutting Social Security benefits for millions of people to help fix the program’s impending funding problem. Every month, people with disabilities and retired adults across the United States get their Social Security payments.

The Social Security Administration is in danger of going bankrupt as early as the mid-2030s because more baby boomers are leaving and fewer younger workers are paying into the system. That means there might not be enough money to pay all the benefits unless big changes are made.

Americans would support cuts in Social Security benefits under specific circumstances

Most Americans are against lowering Social Security benefits, but a new study from the University of Maryland’s School of Public Policy’s Program for Public Consultation showed that most Americans would be okay with lowering benefits in some situations.

The study had about 4,600 participants, and 53% of those people said it was “acceptable” to cut monthly payments for the top 40% of earners. These changes, according to the study, would make the next Social Security shortfall 23% smaller.

A teacher of financial literacy at the University of Tennessee named Alex Been says that this reform could still make Americans very worried about their trust in the Social Security system.

It’s always tempting to cut costs in order to fix a program’s money problems, but Beene told Newsweek that it would be stupid to stop paying all Social Security recipients, even those with higher incomes. It’s not fair to people who get benefits but have also given, and it makes people who aren’t affected think that their benefits will soon be cut too.

He also said that some leaders are fooled into thinking they can cut benefits for a growing group of people when they can only cut benefits for a small part of that group. People who took the poll were put in an online policymaking simulation to learn about different ideas for reforming Social Security and the pros and cons of each.

Americans are willing to debate Social Security benefits and its future

Most polls showed that both Republicans and Democrats wanted to raise the payroll tax and include wages over $400,000 in the tax. The current cap on wages subject to this tax is $169,000. Raising this cap would give the SSA more money.

Nearly 90% of Republicans and Democrats in swing states agreed that the retirement age should be raised to fix the budget problems and close the 15% pension gap.

Drew Powers, head of the Powers Financial Group in Illinois, says that Americans were mostly in favor of cutting benefits when the terms “top 20” or “top 40 percent” were used. But when the same policy was talked about in a different way, public opinion changed.

People who answered were mostly against cutting benefits for retirees with higher incomes, Powers told Newsweek. This was true even if more specific language was used, like “middle class in high-cost areas” or “paying into Social Security with the promise of benefits.”

He also says that this shows that Americans are ready to talk about and put into place a more complicated system of means testing for Social Security. People who make a lot of money don’t miss out on Social Security because the money they get is such a small part of their retired income.

Finally, Kevin Thompson, the president and CEO of 9i Capital Group and an expert in finance, recently said that cutting Social Security benefits in half would likely face strong resistance in the United States, even though most high-income earners don’t depend on them very much.

Thompson also told Newsweek, “I don’t think it’s the right way to go to cut benefits for people with high incomes based on their percentage of income.” A means test, on the other hand, might be needed to keep Social Security payments going. There are likely a lot of people and their representatives who would be against this kind of law.

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