Most discussion in Washington of the projected long-term shortfall in the Social Security trust fund assumes that we can never raise the payroll tax. Many have advocated raising the cap on wages subject to the tax (currently just over $113,000), but raising the tax rate itself has largely been out of the question.
While there are good arguments for raising the cap (the increase in the share of income going over the cap due to the upward redistribution of income is a major reason for the projected shortfall), it is not obvious why increases in the tax rate at some future date should not be considered.
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