Should we phase out Social Security? 2 economists debated it for an hour in front of me—then agreed the wealthy have to pay up

Romina Boccia, the director of budget and entitlement policy at the libertarian Cato Institute and coauthor of Reimagining Social Security, and Teresa Ghilarducci, a labor economist at the New School for Social Research and a senior research fellow at Arizona State University, spent an hour on NPR’s Open to Debate on the subject, “Should We Phase Out Social Security?” Boccia argued yes. Ghilarducci argued no.

Then I asked them a different question: Who is going to make the biggest tradeoff in repairing the system? The disagreement mostly evaporated.

“It’s going to be those Americans who have the greatest capacity to absorb either benefit reductions or higher taxes that are going to bear the brunt of the cost of reforming the system,” Boccia said. Ghilarducci agreed on the target, if not the method: “The way to get money for Social Security…is going to be at the top.”

Everyone agreed, furthermore, that Social Security in its current state will be phased out one way or another. The program’s trust fund is set to become insolvent by 2032 under current policy, so changes have to be made, and soon. The takeaway is clear: The wealthy are going to pay for this, but the real dispute is whether “paying” means smaller checks or bigger tax bills. It’s a fight that’s older than either of them, dating back to the very creation of Social Security itself during the Great Depression as part of Franklin D. Roosevelt’s New Deal. The continuing debate over Social Security’s future reveals much about how America never fully made peace with the implications of that social contract.

Two visions of Social Security

Boccia’s argument was that Social Security has become an expensive wage-replacement system that sends its largest benefits to people most capable of providing for themselves. Workers and employers contribute 12.4% of wages through the payroll tax, she noted, but those contributions are not saved in individual accounts; they immediately finance current benefits. In her telling, that leaves younger workers with less money to buy homes, raise children, build savings, or invest in their own retirement—while a system ostensibly designed to prevent poverty still leaves some older Americans poor.

Her alternative is to narrow, rather than abolish, the program: replace the current earnings-related benefit with a predictable, flat benefit that protects people from poverty in retirement, while allowing........

© Fortune