Anyone who has looked at these issue for more than 6 seconds knows that social security is relatively stable and solvent, but medicare is not.

And, yes, taxing all W-2 income would ensure Social Security solvency. And then some—it would be one of the largest tax increases in American history if it were done at current FICA rates.

From 'round the sphere...
NEWS:
*  For Retiring Republicans, Several Explanations - NY Times
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* Tongues sharpened for d...

Before solutions are proposed it's probably a good idea to consider the political constraints for the solutions. We're not going to eliminate either the Social Security or the Medicare programs. They'll continue to exist in some form for the foreseeable future. Within those constraints what's the best solution for solving the prospective Social Security imbalance.

I continue to believe that whatever problem exists with Social Security will be corrected as it has before: with a combination of increasing the Social Security retirement age, increasing the FICA rate, reducing the benefit level, and borrowing. One may rail against the unfairness of it all (as I'm sure will be done in comments to this post) but that's what's going to happen.

The prescription depends somewhat on what one thinks the problem with Social Security is. It's generally painted as being too few workers supporting too many benefit recipients but I think that's too narrow a view. Our society has changed (largely, in my opinion, through the confluence of government policy decisions and technological change) so that most income increases over the last 30 years have been concentrated in the top decile, indeed, in the top 1% of income earners.

Consequently, it's not a case of too few workers supporting too many beneficit recipients. It's an increasing proportion of income excluded from the tax. If that's the case the solutions are to change policies so that median incomes increase (and FICA revenues along with them), or subject a much higher proportion of income to the tax either by raising FICA max substantially or eliminating it altogether.