Social Security is in trouble.
Contrary to what some believe, the program is not going "broke."
It will continue to be around for a long time, but the troubling threat of a benefit reduction in the 2032-33 timeframe does exist due to predictions that the main Trust Fund will run out of money during that period.
Social Security was designed as a "pay‑as‑you‑go" system, meaning that today's workers fund today's retirees.
However, for many years the program collected more money than was needed to pay benefits, and those excess amounts were placed into a fund ‒ the OASDI Trust Fund.
By 2021, that fund had accumulated over $2.9 trillion.
Since then, the number of baby boomers that have begun collecting benefits has put the program in a position in which not enough money is being paid in to cover current benefits.
As a result, the Trust Fund is being rapidly drawn down to pay those benefits.
(See: Trust Fund Data)
If steps are not taken to correct this, current estimates show retirees would receive a benefit cut of around 23% when the trust fund is depleted.
For millions of seniors who rely on Social Security as their primary income source, such a reduction would be financially devastating, affecting housing, healthcare, and basic living expenses. (Details here: What may happen to Social Security in 2033 if trust funds aren't fixed, and here: Social Security, Medicare heading for 2033 crisis, trustees report - Insurance News | InsuranceNewsNet).
The pay-as-you-go Social Security structure emerged during the Great Depression when the government needed to provide immediate support to older Americans who had no savings or pensions.
Instead of building a large investment fund, payroll taxes were collected and distributed directly, creating a stable intergenerational compact.
Over time, demographic shifts (longer life expectancy and lower birth rates) have strained this model, but the basic structure remains unchanged. (More: Here's How Much Money You Could Lose if Social Security Goes Bankrupt | Retirement | U.S. News).
Among the many options to restore solvency, one idea is to use tariff revenue to help fund Social Security.
Tariffs function as taxes on imported goods, and when imposed broadly, they generate substantial federal revenue.
Redirecting some of this revenue would help close the funding gap without raising payroll taxes or cutting benefits.
However, tariffs also raise consumer prices, which can disproportionately affect retirees living on fixed incomes. (An explanation, here: What Retirees Should Know About Tariffs - Zinnia Wealth Management).
According to estimates that narrowly focus on the cost of tariffs without considering the benefits to the economy, tariffs could cost families up to $1200 per year.
By comparison, if the Trust Fund runs dry, a 23% benefit cut would cost the average retired couple far more ‒ an estimated $18,100 annually.
In other words, if tariff revenues were used to bolster Social Security, the benefits to over 70 million retired Americans would far outweigh any associated costs.
When you take into account the economic impact of Social Security, this would be a win for all Americans. (See: Here's How Much Trump’s Tariffs Have Cost Each American Household | The Independent, Retirees Face an $18,100 Benefit Cut in 7 Years-2025-07-24, Monthly Statistical Snapshot, January 2026).
The last resort is to cover Social Security shortfalls through the general fund, but this would require the federal government to borrow money.
Borrowing to sustain a program historically funded by workers risks undermining the pay‑as‑you‑go principle upon which the program was founded.
It also adds to the national debt, shifting the burden to future generations, rather than maintaining the intergenerational balance the program was built upon. (More on shifting burdens: Here's How Much Money You Could Lose if Social Security Goes Bankrupt | Retirement | U.S. News)
A more responsible and historically proven approach would be to form a bipartisan commission to recommend long‑term solutions.
President Reagan did exactly this in the early 1980s by appointing the Greenspan Commission, whose recommendations extended Social Security's solvency by more than 50 years.
The success of the Greenspan Commission demonstrates that bipartisan cooperation ‒ grounded in shared responsibility rather than political posturing ‒ can stabilize the program for decades. (Here's How Much Money You Could Lose if Social Security Goes Bankrupt | Retirement | U.S. News)
We can, and should, replicate this approach today. With the 2032 deadline approaching, Americans should urge their congressmen and senators to encourage President Trump to appoint a new Reagan‑style commission.
Social Security is too important to leave to chance, and a bipartisan commission remains the most effective path to preserving the full benefits of the program for current and future retirees.
We Americans can also play our part by making sure that Republicans hold the U.S. House and U.S. Senate during the midterm election cycle.
By doing this, we can ensure that Congress will focus on fixing problems instead of investigations and impeachment.
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