President Donald Trump's defeat in the 2026 midterm elections hands Democrats new leverage to hold the Republican leader accountable across a range of policy fronts. Yet it may also create room for cooperation on an issue with sweeping consequences for millions of Americans' economic futures: the looming insolvency of Social Security, the federal program that sends monthly checks to retired workers, people with disabilities and the family members of deceased workers.

According to a report by The Wall Street Journal's Richard Rubin and Lindsay Wise published Wednesday, "Social Security is heading toward insolvency in 2032, and Democrats may take a shot at legislation that would stave off the automatic benefit cuts that would bring." Insolvency, in the program's financing, would not mean the checks stop: once the trust funds run short, continuing payroll tax revenue would cover only a portion of scheduled benefits — the automatic-cut scenario the Journal describes. The 2032 date tracks the annual assessments Social Security's trustees publish on the trust funds' finances. The reporters noted, "Many of them favor raising the earnings cap, now $184,500, where payroll taxes stop. Jeffries has talked about expanding the low-income housing tax credit, the earned income tax credit and the child tax credit." That cap is the wage ceiling for the 6.2 percent payroll tax that funds Social Security, paid by workers and matched by employers; earnings above it currently go untaxed by the program.

The report added that Democrats' incoming Senate control will allow them to block Trump's judicial and executive branch nominees, including any Supreme Court picks. "Republicans will likely push through as many confirmations as possible before they lose power January 3rd," the reporters wrote. "But once vacancies emerge, the partisan divide will either mean acting officials in key administration positions or compromise nominees who can satisfy Democrats." They also identified potential areas of compromise between Trump and Democrats, including support for farmers, a tax credit for film production and an overhaul of permitting rules for major projects. Any stand-alone Social Security bill would face a related constraint: it would need majorities in both chambers, which Democrats are set to control, and the signature of a president whose party just lost the midterms — the arithmetic that makes the cooperation the Journal describes central to whether legislation advances.

Former Social Security Commissioner Martin O'Malley, who served under President Joe Biden, told AlterNet in an exclusive interview that he did not entirely agree with the Journal's take on the issue.

"I believe that Social Security is the biggest and easiest, and politically the easiest, affordability win that the new Democratic supermajority in the House could pass," O'Malley told AlterNet. "To claim that Social Security is going totally insolvent is just not true. But in order to guarantee its ability to pay 100% of benefits, we must demand that the super wealthy pay the same Social Security tax rate on their earnings that the rest of us do. And if we do that, we can not only increase benefits to address the affordability issues faced by 71 million beneficiaries, but we can do so in a way that doesn't add a penny to the national debt or deficit."

Asked whether he backs the four measures flagged by the Journal — raising the earnings cap, expanding low-income housing tax credits, expanding earned income tax credits and expanding child tax credits — O'Malley said none would match the reach of an increase in Social Security benefits.

"Those other three things are all fine and good, but none of them would have the impact on as many Americans as increasing Social Security benefits by demanding that the super wealthy pay their fair share, namely the same tax rate the rest of us pay on our earnings," O'Malley told AlterNet. "So all of those other three things are fine, and they're good things, and they should do them. But there is nothing that would be as popularly supported and applauded, and needed as broadly by as many Americans, as the very straightforward and simple fix of increasing benefits by requiring that the wealthy pay their fair share."

The markers to watch from here: whether Democratic leaders move stand-alone benefit legislation early in the new Congress, how the White House responds, and what the trustees' next annual assessment shows about the trust funds' finances.