Some Sensible Changes to Social Security

Mr. Brooks is wrong to try to implicate Social Security as one of the causes of our fiscal problems (New York Times, February 22, 2013: A21). The fault clearly lies with the decisions over war and taxation made by the Bush Administration. Yes, the overhang from those is still with us.
In fact, relatively simple fixes can restore Social Security to continuing prosperity. However, cutting benefits through the chained-CPI (Consumer Price Index) measure or by raising the retirement age are not the way to go because they adversely affect the poorest recipients most drastically. The chained CPI lags the existing CPI by 0.25%, and worse still, the ordinary CPI lags the experimental elderly CPI by 0.3%.
There are alternatives at both the paying in  side and at the paying out side.
Paying in, we could lift or abolish the cap. This would make social security solvent.
Paying out, we could change the tax treatment of Social Security. Rich Americans only pay income tax on 85% of their Social Security income. One hundred percent of social security income should be included in gross income. The impact on low income seniors would be negligible; on rich Americans it would be a modest increase in taxes.
Paying out we can also look at the payout rate. Despite being regressive at the paying in stage, Social Security is quite progressive when paying out.  Right now the Social Security formula for computing one's pension depends on Average Lifetime Earnings (ALE). Each year's earnings are converted into constant dollars and then a monthly average is calculated. Based on this, Social Security pays you:
- 90 percent of the first $767 of monthly ALE - 32 percent of monthly ALE between $768 and $4,624, - 15 percent of monthly  ALE above $4,625 to the cap of $9,475.
Changing the breakpoints, increasing the number of breakpoints (say new breakpoints at $3,000, at $6,000, and at $8000), or reducing the percentage payout at the highest level would maintain payouts for the poorest in our society, but reduce expenditures to those who can most afford it.
Could both Democrats and Republicans agree to such a scheme?
Sent to New York Times