RPhilbeck wrote on Wed, 26 September 2007 08:20 |
In another thread we talked about, "rich" being a relative term. Apparantly, anything over $97,000 a year is rich. So now we know.
by Neil Boortz
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Well, there's one problem right there. Boortz is an idiot. And he doesn't understand how the Social Security tax is handled. Nor do you, it seems.
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SOCIAL SECURITY 'FIX'
Barack Obama's great idea for saving Social Security? Easy ... eliminate the earnings cap. Just go ahead and tax every penny someone makes – no matter how much that is – at the full Social Security rate. wants to impose a 12.4% tax on all income above $97,000 per year. He says that by taxing the rich we can eliminate the entire Social Security shortfall.
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Already, EVERY WAGE EARNER pays FICA (Social Security). The employee pays 6.2% of salary (income), up to $94,200, and the employer pays another 6.2% of salary (income), again up to $94,200. (That cap is adjusted upwards every year.) (If you are self-employed, then you are responsible for paying the entire 12.4%.) Earnings over this cap are not taxed for Social Security purposes, if your income exceeds the cap, so once you pay the $5,840, you do not pay any more FICA taxes for the rest of the year.
The cap makes the FICA tax regressive, in the sense that the person making $200k per year pays proportionally less into FICA than someone making $40k per year.
Obama's recommendation (and it's not his idea) is to eliminate the $94,200 cap. In other words, you and your employer will continue to contribute to FICA at the same percentage regardless of income level. This makes the tax less regressive, in other words, more fair, and has the desired effect of putting more money into the Social Security trust fund.
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Robert Bixby is the executive director of the Concord Coalition, a non-partisan group advocating a balanced budget. He says that this would be a radical change from how Social Security was originally designed, because "it would end the contributory idea of Social Security, where you get back something for what you put in."
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Robert Bixby is an idiot and doesn't understand how Social Security is funded. Your current contributions have ALWAYS gone to pay for the CURRENT retirees, and when you retire, your payment will come from the deductions of future workers.
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SOLUTION?
Simple .. the FairTax. The economic growth that would come from the expansion of business and our economy from the enactment of the FairTax would protect Social Security for generations.
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Seems to me that taxing ALL income at the same percentage is the very defintion of "Fair Tax."
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Tourists. When the come to this country and spend their billions of dollars on everything from ash trays to second homes, do they pay any Social Security tax?
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No, because Social Security is a payroll tax, not a sales tax.
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No, not a penny. But under the FairTax every dollar a tourist spends on a hotel room in New York or a ticket at Disney World would see 23% sent to the federal government.
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So has anyone calculated the effects this would have on tourism? And though the idea is to extract money from foreign visitors, doesn't it also extract money from American vacation and business travelers?
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Ditto for the underground economy and the money spent by our wonderful, hard-working illegal aliens. Just how much do you think they're paying into Social Security now?
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But they're also not getting any of the benefits of Social Security. If the illegal immigrant gardener lives to be 65 and "retires." do you really think he's going to claim his benefits?
Please ... just learn to think things through, rather than parroting the bullshit claims of know-nothing conservative commentators.
-a