Shining a light on a murky election-year Social Security debate

In North Carolina, a television ad attacks incumbent Democratic Senator Kay Hagan for supporting a "controversial plan" that "raises the retirement age" for Social Security. The ad comes from Crossroads GPS, the super PAC run by Republican Karl Rove.

A Republican attack on a Democrat for cutting Social Security benefits? It's just one instance where voters are hearing confusing claims about Social Security reform. Social Security has surfaced as a major issue in Senate rates in Alaska, Colorado, Iowa and Arkansas.

Seeing through the fog can be difficult. Hagan, for example, left herself open to Rove's attack by saying encouraging things about the 2010 Bowles-Simpson report on the federal deficit - which did call for a gradual increase in retirement ages. Bowles-Simpson never came up for a vote, and Hagan never specifically endorsed higher retirement ages. But no matter.

Elsewhere, candidates are lobbing charges at one another about privatizing or means-testing Social Security - while others want to pump revenue into the system and expand benefits. Many candidates say they want to "strengthen" Social Security or keep it "strong." That could mean anything, but usually it is a tactic for leaving the door open to benefit cuts.

Social Security is most Americans' primary retirement resource, and voters deserve straight answers. A debate about the program's financial challenges is overdue, and could bubble up to the surface in Congress soon.

Social Security's trust fund is projected to be depleted in 2034, when the youngest baby boomers turn 70. At that point, revenue from payroll taxes would cover just 77 percent of benefits. Fixing the problem will mean new revenue, benefit cuts or some combination of the two. It could even involve increased benefits for at least some seniors, an idea advocated by a growing group of progressive Democrats.

Here are the questions on Social Security that voters - and journalists - should be posing to candidates this fall.

- Do you support a higher retirement age? Social Security benefits pivot around the Full Retirement Age (FRA), the age at which you're entitled to 100 percent of promised benefits. That age already is rising from 65 to 67, based on year of birth. Further changes could involve tinkering with the FRA, or with the earliest eligibility age, currently 62. In any case, it's important to understand that a higher retirement age is a benefit cut, no matter when you retire. That's because it raises the bar on how long you need to wait to receive benefits.

- Do you support the "chained CPI?" Social Security awards an annual cost-of-living adjustment (COLA) tied to the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). President Barack Obama and others in Washington have advocated switching to a "chained CPI," which some say more accurately measures changes in consumer spending. But it's a benefit cut. The Social Security Administration has estimated the chained CPI would reduce COLAs by three-tenths of a percent annually. Under this scenario, the anticipated 1.7 percent COLA for 2015 would be 1.4 percent.

- Should Social Security be "means tested?" This sounds painless. The wealthy don't need Social Security, so cut their benefits. Trouble is, it wouldn't do much to help Social Security's finances, since the program's benefits don't go mainly to the rich.

Means-testing also implies a fundamental change to Social Security's promise - you pay into the system while you work in return for a promise that benefits will be available in retirement.

- Should benefits be increased? Rising income inequality and diminishing traditional pensions have many seniors facing the prospect of impoverished retirements. Legislation proposed in the Senate would boost benefits by $65 a month, on average, and make the COLA more generous, not less. The bill would pay for all that - and extend the trust fund's life substantially - by phasing out over five years the cap on earnings subject to Social Security taxes ($117,000 this year).

The next Congress may be forced to deal with all this because of another financial problem with Social Security. The disability program will be able to pay full benefits only through the end of 2016. If Congress doesn't act soon, 9 million disabled people will see their benefits cut by 20 percent.

The solution is a small reallocation of resources from the retirement program, but Republicans are indicating that disability reform won't be done without reform to the entire Social Security system.

Says Nancy Altman, co-director of Social Security Works, a Social Security advocacy group: "It's going to be an action-forcing event."

Voters take note.