GAO: Social Security Not in Crises, But Needs Reform

While the current Social Security system is not in crisis mode, it faces serious problems with regard to solvency and sustainability, according to the Government Accountability Office. The auditor general said that if nothing was changed with the 70-year-old program until 2042, "achieving an actuarial balance" would require a 30 percent reduction in benefits or a 43 percent increase in payroll taxes. The GAO also labeled Social Security's problems "a subset of our nation's overall fiscal challenge." Absent reform, the country would have to choose among escalating federal deficits and debt, gargantuan tax increases, or federal budget cuts. However, the GAO warned that when evaluating any reform measure, financial stability should not be the sole criteria. A equitable balance with regards to benefits, as well as administrative and operational issues, also require consideration. The auditor general added that any changes enacted with Social Security should be made "in the context of the broader challenges facing our nation," such as those concerning private pension systems, Medicare and Medicaid.