That’s an interesting concept and may well happen.
Good analysis.
I wonder what will be defined as “earnings”?
If nothing else it will pretty much guarantee some low end jobs opening up because nobody will want to be working at a low paying job that jumps them into a SS killing tax bracket.
Glad my post retirement “job” is in the underground economy.
My example would be wrong on details. I only meant that as SS becomes bankrupt, payments will be scaled back until only the poorest will get their full amount from their benefit formula, and this will rapidly fall off as you have more income or savings, until quickly you get nothing or get to keep nothing.
I was just using a concrete example to illustrate a concept. I have savings and expect a good pension. I will be considered too rich to collect much or any SS payments, because there will be no choice. Those with savings and income are not going to riot in the streets, so they will be impacted, as usual. Those who are destitute will riot in the streets, so they will be rewarded with full payments.
The tragedy here is, once again, if you worked your butt off your entire life and saved for the future, you get screwed. If you lived up to your eyeballs in debt to live a lavish life of fun and games and saved nothing for retirement, you get rewarded for it. It is just like the bailouts. It is ant and grasshopper.
In modern America, you get punished for being responsible but you get rewarded for being irresponsible. And you know what they say, you get more of what you subsidize.