Presidential candidates weigh in on Social Security system

When asked about Social Security during their first presidential debate, both President Obama and Mitt Romney gave brief, detail-free, and general answers, according to CNN Money.

Regardless of who’s elected president, Social Security reform is likely to be on the administration’s agenda.

Social Security benefits had always been financed by current workers’ payroll taxes. For years, the system collected more revenue than it paid out. But that surplus was borrowed by the U.S. Department of the Treasury for other needs.

Now Social Security is taking in less money than it pays out in benefits, but it’s tapping into some of the money that the Treasury owes the program.

At this point, predictions are that by 2033 the Treasury will have paid back the program in full and that payroll taxes will only cover 75 percent of the promised benefits to retirees.

When asked about the program during the first debate, Obama said, “it’s going to have to be tweaked.” Among other things, the reform will have to slowly raise the retirement age and increase the payroll tax rate.

Romney also said that he would add a year or two to the retirement age. And the “means testing” of benefits that he supports would slow the growth in payments for wealthier retirees.

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