Unlike the Bush-era plan to partially phase out Social Security and replace it with private investment accounts, this plan takes a different approach. Through a variety of mechanisms, this plan simply cuts benefits and introduces means testing. To look at specific cuts, changes in eligibility and so forth look at pages 2 and 3 on this official Social Security Administration scoring document analyzing the plan. The benefit cuts appear to hit everyone but are weighted toward more affluent recipients.
The big picture is that the current Social Security Trust Fund is predicted to be exhausted in the mid-late 2030s. So roughly in 20 years. People often refer to this as 'bankruptcy'. But that's not really accurate. At that point Social Security would only be able to pay 79% of benefits recipients will be entitled to in those years.
By 2090, that percentage falls to 74%. So it's fairly stable after that drop-off in the 2030s.
Now there are a number of ways to cover that shortfall — the most obvious is to remove or alter the so-called 'cap' on Social Security taxes. Once you get over $118,500 of income per year you stop paying Social Security taxes. So your Social Security tax rate is much higher if you make $50,000 a year than if you make $500,000 a year. Change that and most of the problem disappears. You could also combine ditching the 'cap' with much milder cuts than the one envisioned here. You could also rejigger the cap in ways that allowed you to increase benefits.
Here's a snippet from a 2015 TPM article which notes how the entire shortfall problem could be solved even without getting rid of the cap entirely ...
One of the co-sponsors of that bill was Sen. Sherrod Brown (D-OH), now ranking member of Senate Finance's Social Security subcommittee. Brown spoke in favor of the CAP report last week and told TPM that he would soon introduce legislation of his own. The CAP report said that because of growing income inequality, the percentage of the collective national income taxed for Social Security had fallen from 90 percent to 83 percent. Raising the cap in 2015 to again tax 90 percent of the nation's applicable income would close Social Security's $11.1 trillion shortfall over the next 75 years by more than one-fourth, according to CAP.
The plan with this new GOP bill is to proactively solve this problem entirely with cuts and really big cuts. Out over 75 years, the GOP proposal has the Trust Fund growing substantially out into the infinite horizon. In other words, a lot of the cuts are more than are necessary to pay for all benefits even if you leave the 'cap' in place.
I will say that this new bill is different and I think not as bad (extremely low bar) as the partial phase out of Social Security which President Bush tried to push in 2005. Because you have the same essential mechanisms in place. This is a huge benefit cut. Benefits could later be raised again if there was the political will to do so. The means testing component probably does more to endanger the future of the program in political terms.