Social Security

What if Social Security Was Capped at $100,000 Annually?

One weird trick could extend Social Security's solvency while reducing payments to the wealthiest households. But it doesn't go far enough.

Eric Boehm | 4.9.2026 1:15 PM

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As Social Security careens towards insolvency in the early 2030s, policymakers and the American public will have to reconsider what the old-age pension program is meant to accomplish.

Is Social Security meant to provide a safety net for senior citizens, ensuring that those who do not have sufficient private retirement savings are kept out of poverty? Or is it meant to finance lavish retirement lifestyles for those who earned large sums during their working years?

Social Security was intended to be the former—President Franklin Delano Roosevelt promised that it would protect against "poverty-ridden old age," when he signed the program into law in 1935.

These days, however, it often operates as the latter. This year, households where both couples maxed out their Social Security contributions during their working years will be eligible to receive as much as $124,000. Most households do not qualify for anywhere near that much, of course, but the fact that younger (and generally much poorer) working-age Americans are being taxed to finance six-figure retirement payments for the wealthiest retirees is finally getting some of the scrutiny that it deserves.

It might also point the way towards a partial solution for Social Security's fiscal problems.

Capping annual Social........

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