The Committee for a Responsible Federal Budget has come up with a very clever tool. It's called "The Reformer: An Interactive Tool to Fix Social Security." Notice that it's to fix Social Security, not what I would like to see, which is abolition. But still, it's very clever and, assuming the underlying model is done right, it's illuminating.
So, for example, let's say that you are convinced that Social Security should be means-tested. Co-blogger Bryan Caplan advocates that and has broughtmekicking and screaming to that conclusion. The Reformer gives you 3 options for doing that. I chose one that I thought people could handle: slow benefit growth for the top half of earners. Result: 35% of the 75-year gap is closed.
Another one: Index the age to longevity. Result: 19% of the gap is closed.
We're over halfway there and we haven't had to cut benefits for any current recipients who are in the bottom half.
One more reform: Index COLAs to CPI minus 1%, on the assumption that Mike Boskin is basically right that the CPI overstates inflation by about one percentage point. Result: 63% of the gap is closed.
The total is 35 + 19 + 63 = 117. In other words, the gap is more than closed so that at some point, the FICA payroll tax could be cut, possibly by a percentage point (0.5 for employer and 0.5 for employee.)
There doesn't seem to be interaction between the variables, which makes me wonder how good the model is. For example, the COLA change above should be expected to decrease the effect of indexing to longevity, from 19% to something less than 19%. I don't know how important a factor this is.