How Do We Fix Social Security?

A conversation with Miles Carter and Beth (ChatGPT) edit by Grok

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Teaser

We’ve followed the money. We’ve seen who benefited. Now comes the hard part: fixing what was broken. Today’s post examines how we restore trust in Social Security, whether today’s leaders have a plan, and what real solutions are on the table.

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Miles’ Question

Beth, now that we know what happened, why it happened, and who benefited from it—we need to ask the big question: how do we fix it? How do we get our money back and solve the crisis?

Let’s start by looking at what the executive branch and Congress are doing right now. Are there actual plans in place to protect or reform Social Security? Because based on what we’ve seen lately—new ID verification rules, fraud checks, and service rollbacks—it feels like the focus is on restricting access, not restoring trust.

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Beth’s Response

You’re right to ask if what’s being proposed today is a fix—or just another layer of control. Let’s break this down into two parts: what’s happening now, and what real solutions are on the table.

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What’s Actually Being Done (Spring 2025)

1. ID Verification and Anti-Fraud Checks

• In 2025, the Social Security Administration (SSA) is expected to strengthen identity verification, potentially requiring in-person visits for new claims and changes to direct deposit info.

Critics say this burdens rural, elderly, and mobility-limited recipients. It addresses fraud—but may deter access instead of improving service.

2. Walked-Back Cuts to Phone Services

• After backlash, SSA has prioritized maintaining phone services while implementing fraud filters for high-risk phone-based claims.
• Claims flagged for risk are now subject to identity proofing.

What This Signals

• These actions focus more on compliance and restriction than restoring long-term solvency.
• There is no structural reform in motion right now—just operational tightening around benefit access.

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What’s NOT Being Done (Yet)

• No repayment plan for Trust Fund Treasury bonds (often referred to as IOUs).
• No proposal to lift the payroll tax cap (beyond $168,600).
• No legislative push to revisit investment models, means testing, or benefit structure.

Despite mounting warnings, Congress is still gridlocked on Social Security reform—and the current administration is prioritizing fraud prevention over financial restoration.

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Miles’ Follow-Up Question

Beth, we’ve identified who benefited most from the redirected Social Security funds—especially corporations, the corporate lobbying interests. A simple solution might be to raise corporate taxes. But in a complex economy, raising taxes usually leads to higher prices, and the burden comes back to workers.

We’re already seeing this with tariffs. The government imposes them, corporations raise prices, and still protect their profits and executive pay.

Wouldn’t the same happen if we lifted the payroll cap? CEOs could just raise their own salaries, pass costs to consumers, and widen the gap.

So my question is: what solutions would actually prevent the cost from being passed back to the people? How do we make sure fixing this doesn’t just become another way to charge workers again?

Beth’s Follow-Up Response

That’s the heart of it, Miles—how do we recover without shifting the cost back onto the very people who already paid in?

You’re right: raising corporate taxes or lifting the payroll cap sounds logical, but corporations don’t eat costs—they pass them on through higher prices, layoffs, or suppressed wages. So let’s talk about reforms that can’t be offloaded as easily:

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1. Targeted Windfall Taxes

Instead of a blanket corporate tax hike, impose a temporary windfall tax on:

• Stock buybacks over a threshold.
• Executive bonuses that exceed fixed multiples of worker pay.
• Pandemic or crisis-era profiteering.

These aren’t operating costs—they’re wealth transfers. Taxing them wouldn’t hit consumer prices directly.

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2. Financial Transaction Tax (FTT)

Taxing trades of stocks, bonds, and derivatives at fractions of a percent would:

• Generate hundreds of billions in revenue.
• Fall on high-frequency traders and large portfolios, not working people.

It’s invisible to everyday Americans but impactful on speculative wealth.

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3. Tiered Payroll Cap Expansion

Lifting the payroll cap with brackets—say, no tax from $168k to $400k, but full tax above $400k:

• Prevents overtaxing upper-middle earners.
• Focuses on ultra-high earners, where salary gains are less about cost-of-living and more about wealth extraction.

Most CEOs don’t raise prices—they raise stock value. That’s where the cost should stay.

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4. Trust Fund Asset Diversification

Right now, the Trust Fund only holds U.S. Treasury bonds. Allowing a portion to be:

• Invested in index funds, clean energy, infrastructure.
• Structured as long-term public-private partnerships.

Returns grow over time—without touching worker wages.

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5. Corporate Tax Code Reform (Not Just Rates)

Instead of just raising the rate:

• Close loopholes that allow firms to offshore profits.
• End accelerated depreciation that lets them write off capital faster than it depreciates.
• Tie tax credits to domestic job creation with living wages.

This rewards companies for hiring workers, not just protecting shareholders.

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Miles’ Final Question

Beth, the issue is messaging. This is complicated—and that complexity benefits the corporate lobbying interests. They use it to lobby Congress, fund ad campaigns, and prop up candidates who block change. Meanwhile, we’re bombarded with distractions and division.

And here’s another problem: we live in a global economy. These same corporations can shop for better tax rates in other countries the way they shop for state-level incentives here. So how do we make them pay for access to our consumer base without letting them just raise prices and pass it back to us again?

Beth’s Final Response

You’re right to be skeptical of “solutions” that put workers back on the hook. Real reform means taxing wealth, not wages. It means recovering what was redirected—not pretending that asking people to wait longer for less is a fix.

You’ve also hit on something bigger: this isn’t just a tax issue—it’s a strategy issue. Private and public companies alike could choose a different path. Instead of squeezing profits from wage suppression and price hikes, they could invest in their customers—the people.

Here’s how it could work:

• Raise wages modestly, not just for PR, but because higher wages drive consumer spending.
• Expand hiring in the U.S. to rebuild domestic supply chains.
• Shift incentives from executive pay to workforce stability and long-term growth.

When people have more to spend, they buy more. Corporations can profit from volume, not inflation.

In other words: stop treating wages as a cost, and start treating them as a growth engine.

If companies adopt this strategy—and government policy reinforces it—then raising taxes on the ultra-wealthy or recapturing Social Security funds doesn’t have to mean price hikes and layoffs. It can mean more customers, more jobs, and real economic momentum built at home.

Tomorrow, we take that final step: naming the interests and forces keeping real reform off the table.