October 14, 2010 / 10:37 PM / 9 years ago

Obama backs boosting revenue for Social Security

WASHINGTON (Reuters) - President Barack Obama said on Thursday he favored raising more revenue for Social Security to prolong the solvency of the U.S. retirement fund, rather than just cutting benefits or making people work longer.

Obama told a televised youth town hall event that he thought the best approach was to increase the amount of income subject to Social Security taxes above the current cap set around $106,000, but he did not rule anything out.

“I have said that all options are on the table. I think we’ve got to look at how we preserve it for the next generation,” he said.

“I do think that the best way to do it would be to look at the fact that right now, you only pay Social Security taxes to about $106,000, and after that you don’t pay any Social Security tax,” he said. “That could be modified or changed in a way that would help extend the solvency of Social Security.”

His remarks lay down a marker for the president’s fiscal commission as it weighs options for Social Security that also include extending the U.S. retirement age, currently set at 67 for those born after 1960, or limiting some benefits.

A report issued in August said Social Security was on track to exhaust its reserves in 2037. Some Republicans have proposed letting seniors invest some of their Social Security funds in the stock market, which Democrats say would imperil seniors’ financial security.

Obama has asked his bipartisan commission to come up with suggestions to reduce the federal budget deficit and put the country on a sounder long-term fiscal footing.

Recommendations are due in December, after midterm congressional elections on November 2 in which the record U.S. budget deficit has emerged as a potent concern among voters.

“My hope is that we can get a Republican-Democratic agreement about how we strengthen Social Security, as well as looking at some of these other major expenditures that we have, that we’ve got to deal with, to make sure that we are not just leaving you guys with a mountain of debt,” Obama said.

The event was shown live on Black Entertainment Television (BET), Country Music Television (CMT) and Music Television (MTV), networks that primarily are aimed at young people.

Reporting by Alister Bull; Editing by Vicki Allen

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