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Social Security income is a necessity for most retirees. Based on more than two decades of annual surveys undertaken by national pollster Gallup, no fewer than 80% of then-current retirees rely on their monthly benefits to cover some portion of their expenses. The mere existence of Social Security ensures that most seniors can make ends meet.

That's what makes this next statement such a gut-check: Social Security is in trouble.

Although America's top retirement program is in no danger of going bankrupt or becoming insolvent, the foundation that supports the existing payout schedule, including annual cost-of-living adjustments (COLAs), may be less than a decade from breaking. Social Security needs attention, and the American public is counting on their elected officials in Washington, D.C., to get to work.

While lawmakers on Capitol Hill have laid out no shortage of Social Security reform proposals, it's one completely off-the-wall approach from the current highest-ranking Republican, House Speaker Mike Johnson (R-LA), which could raise eyebrows.

Image source: Getty Images.

Before diving into the nuts and bolts of Johnson's proposal, it's important to understand why America's leading retirement program is facing an ever-widening funding obligation shortfall estimated to have reached $22.4 trillion through 2097.

The biggest concern is that the Old-Age and Survivors Insurance Trust Fund (OASI), which pays monthly benefits to over 50 million retired workers and roughly 5.8 million survivors of deceased workers each month, will exhaust its asset reserves by 2033. If and when these asset reserves are depleted, sweeping benefit cuts of up to 23% may be necessary to sustain payouts, without the need for any further reductions, through 2097.

While social media message boards are rife with fairy tales about "Congress stealing funds" and "undocumented workers receiving benefits," the reality is that visible and off-the-radar demographic shifts are responsible for Social Security's struggles.

For example, most people are likely well aware that baby boomers are retiring from the workforce and that longevity has increased since the first retired-worker benefit was mailed out in January 1940. But people may not realize that a historically low U.S. birth rate, a more-than-halving in net legal immigration into the U.S. since 1998, and a steady rise in income inequalityhave also contributed to the program's growing long-term funding obligation shortfall.

Although Social Security will absolutely be there for you when you retire (assuming you've earned the requisite number of work credits to receive a benefit), the amount you receive each month could be far less than expected if Congress doesn't act soon.

The OASI's asset reserves are on pace to be exhausted by 2033. US Old-Age and Survivors Insurance Trust Fund Assets at End of Year data by YCharts.

Despite being relatively tight-lipped about Social Security since becoming House Speaker, Mike Johnson has historically not been shy about supporting proposals designed to reduce the program's long-term outlays.

During the 116th Congress, Johnson was the Chair of the Republican Study Committee (RSC), a conservative caucus of House Republicans. For fiscal 2020 (the federal government's fiscal year ends on Sept. 30), the RSC and Mike Johnson released a nearly 200-page budget that aimed to reduce costs in all facets of government -- including Social Security. The RSC's budget proposed implementing the Social Security Reform Act that former House Rep. Sam Johnson (R-TX) first introduced in 2016.

The 10 Social Security changes Mike Johnson's budget supported are as follows:

These sweeping reforms supported by the RSC and then-Chair Mike Johnson were estimated to reduce spending on America's top retirement program by $756 billion over 10 years.

Image source: Getty Images.

Although the scope of the RSC's proposal is unlike anything we've seen before from Capitol Hill, it, like other legislation before it, would struggle to get off the ground in the House and/or Senate.One of the biggest issues with Social Security reform is that all proposals result in some group of people being worse off.

For example, President Joe Biden and his Democratic colleagues have proposed reinstating the 12.4% payroll tax on earned income above $400,000. Currently, only earned income (wages and salary but not investment income) between $0.01 and $168,600 is subject to the payroll tax. Though reinstating this tax would provide Social Security with an immediate influx of revenue, it wouldn't provide an added cent in benefits for the high earners paying this extra payroll tax.

On the other hand, Republicans (including Mike Johnson) have often touted a gradual increase to the full retirement age as a viable solution to reducing long-term outlays. The problem is that raising the full retirement age will lower the long-term benefits collected by lifetime low-earning workers.

Fixing Social Security means making a hard decision and putting a certain group of Americans on worse financial footing than they were prior to reforms.

What's more, both parties' proposals have unique flaws. The GOP plan takes decades to yield significant cost reductions, which wouldn't provide any help to the OASI's impending asset reserve depletion in nine years. Meanwhile, taxing the rich by itself doesn't come close to overcoming Social Security's $22.4 trillion funding shortfall.

Just as we witnessed when the Social Security Amendments of 1983 were signed into law, the best approach to strengthen Social Security's foundation will be one that incorporates solutions from both parties. Since it takes 60 votes in the Senate to amend Social Security, fixing this program will require collaboration.

Though Mike Johnson is unlikely ever to gain bipartisan support for his broad-reaching Social Security plan, it serves as a reminder that off-the-wall solutions from both parties may be necessary to shore up this program for future generations of retirees.

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This High-Ranking Republican Supports an Off-the-Wall Solution to Tackle Social Security's $22.4 Trillion Cash Shortfall - The Motley Fool