Social Security Reform : Evaluating Current Proposals: Latest Results of the EBRI-SSASIM2 Policy Simulation Model

The present Social Security program has been shown to be financially unsustainable in the future without modification to the current program. The purpose of this paper, the Employee Benefit Research Institute's fourth in a series on Social Security reform, is threefold: to illustrate new features of the EBRI-SSASIM2 Policy Simulation Model not available in earlier EBRI publications, to expand quantitative analysis to specific proposals, and to evaluate the uncertainty involved in proposals that rely on equity investment. This analysis compares the Gregg/Breaux-Kolbe/Stenholm (GB-KS) and Moynihan/Kerrey proposals with three generic or quot;traditionalquot; reforms: increasing taxes, reducing benefits, and/or increasing the retirement age. Both proposals would create individual accounts by quot;carving outquot; funds from current Social Security payroll taxes. This analysis also examines other proposed changes that would quot;add onquot; to existing Social Security funds through the use of general revenue transfers and/or investment in the equities market