The Social Security funding shortfall is not mainly due to demographics (longer lifespans or lower birth rates), but largely the result of slow wage growth and massive upward redistribution of income since the 1980s.

Rising inequality has severely hurt the program’s finances: A much larger share of wages now escapes the payroll tax because it goes to high earners above the cap, and more income flows to untaxed corporate profits.

If real wages had grown as projected (in line with productivity), the trust fund shortfall would be mostly eliminated; the author argues the problem stems from deliberate government policies favoring the rich, not overly generous benefits.

The rich almost completely control debate in this country. There is no better proof of this fact than the current debate over the future of Social Security.

This has been conveniently framed as a problem of demographics. You know, too many people living long into retirement and not enough kids entering the workforce. That sounds compelling, as long as we don’t try to think about it too much.

First, we knew this basic story long ago. On the life expectancy side, we’re actually doing somewhat worse (better from the standpoint of the program’s finances) than was expected in 1982, the last time there was a major reform to the program. The projections from that year showed men living on average 16.6 years after they turned 65. We are beating that some in the current projections at 18.2 years. But the story for women looks considerably worse than was projected in 1982: 20.7 years now compared to a projection of 22.6 years in 1982. So, we can’t say the problem is people are living longer than expected.

The fertility rate has fallen behind projections, and that has made the financing of the program worse. But the big story is that wage growth has fallen far behind........

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