{"text":[[{"start":0,"text":"Kirk O’Donnell, a top aide to former US House of Representatives Speaker Tip O’Neill, called the social security system the “third rail” of American politics — like a high-voltage line on an electric train, touch it and you’re dead. Politicians see little personal political benefit and significant risk in tampering with the key pillar of the US social safety net."}],[{"start":0,"text":"But today the system faces a crisis: by 2032, the retirement trust fund will be insolvent. This would mean a 22 per cent reduction in benefits to American retirees, a national average cut of $500 a month. Years of resistance to reform have brought things to this point. The two parties in Congress face a game of chicken as the system spirals towards demise."}],[{"start":23.72,"text":"Social security is a pay-as-you-go system, meaning current payroll taxes cover current retiree benefits. As the ratio of retirees to working-age Americans climbs, the system is coming under increased strain. The impact of an ageing US population and declining birth rate is staggering: retirement-aged people made up just 8 per cent of the US population in 1950, but will make up 21 per cent by 2030."}],[{"start":49.38,"text":"Congressional gridlock and polarisation make solving the problem extremely difficult. But a bipartisan solution to save social security is not entirely out of the question. Senators recently introduced a bipartisan bill to conduct a further study of the problem, and the ingredients of a compromise are clear. A combination of more funding, lower payout and a higher-yielding investment strategy could make social security solvent again. Members of Congress can be on the right side of history by adopting bipartisan reforms to save the system."}],[{"start":80.56,"text":"A first step would be reforming the social security payroll tax cap. The system’s design as an insurance model means that income above $184,500 is exempt from social security tax. Under this regime, low-income workers pay a significantly higher proportion of their income to social security than the highest earners. Lifting the cap has bipartisan support in the Senate, and polling indicates majority support among Democrats and Republicans."}],[{"start":107.8,"text":"Raising the retirement age, which will reach 67 next year, would also shore up funding. Today’s retirees live longer, putting a strain on pension liabilities. Polling suggests 74 per cent of Americans already plan to work past retirement age — but an across-the-board rise could place a burden on workers with more physically demanding jobs who have difficulty working into later age. Attempts to raise the retirement age, however, could trigger a backlash similar to that in France, where pension reforms sparked protests, or the contentious debates in Germany."}],[{"start":140.88,"text":"Investing social security funds, which currently sit in low-yielding US Treasuries, would also be beneficial. As stocks have boomed over the past half-century, social security returns have underperformed private pensions. This conservative arrangement is in part by design to avoid excess risk. Some senators have proposed ways to move towards a system that invests in equities, reflecting the realities of the 21st-century economy. It would be a mistake, however, to allow the fund’s investment decisions to be subject to political whims."}],[{"start":172.32,"text":"Ultimately, President Donald Trump will be the final decision maker on changes to social security. Over the next two years, he has few incentives to advocate for tax rises and benefit cuts, but every incentive to pass on the looming crisis to his successor. The fate of social security will most likely be decided by the president who wins in 2028, and the congresses during that term, which will include many members who hold seats today. They will have to decide whether to preserve the cornerstone of America’s social safety net for nearly a century, or allow it to fail."}],[{"start":207.56,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1786275552_5660.mp3"}