Fed boss Alan Greenspan cuts to the chase with plans for "saving" Social Security. He reccomends cutting benefits and raising the retirement age. Chairman Greenspan also suggests Congress give itself a deadline of 2008 -- when the massive wave of baby boomers start retiring.
The baby boom retirement is the single biggest threat in the short term for Social Security. The system is paid for by people working today -- paying for those who are retired now. So, as baby boomers retire, there will be fewer people working, more retired, and the surplus in the Social Security Trust Fund will have to make up the difference. That won't last forever, and will eventually run out.
Raising the retirement age or cutting benefits would stretch the amount of money in the system keeping Social Security afloat longer. (Chicago Tribune)