The Top Ten Things You Need To Know About Social Security
1. Social Security has never added a penny to the national debt.
2. Social Security is funded entirely by employee/employer contributions through FICA taxes, ie: payroll taxes. Social Security is not a part of the budget. No federal tax monies outside of those collected through payroll taxes are used to fund SS.
3. Social Security is currently running a SURPLUS of $2.7-trillion. Name another government program that is running such a surplus.
4. Ronald Reagan raised the FICA tax 14.8%, from 10.8% to the 12.4% of today. In 1983, he also levied taxes on 50% of SS BENEFITS to higher income brackets, which had never been subject to taxes prior to Reagan. The law also made it mandatory that the self-employed pay the full ride on FICA taxes (before 1983, they had only to pay the employee half. So much for encouraging small businesses!). The public was told by Republican Ronald Reagan that these increases would make SS solvent in perpetuity.
5. The Social Security Trust Fund runs a big enough surplus that politicians are in effect borrowing from the Fund to pay for their pork projects.
6. By law, any surplus in the Social Security Trust Fund must be used to buy interest-bearing Treasury Notes that are "backed by the full faith and credit of the USA." You will often hear conservatives say that "the SS Trust Fund is gone. There's nothing there but a bunch of IOUs." If that is true, then every investor in the world who buys US Treasury Notes (ie: those "IOUs"
has been put on notice by conservatives that their Treasury notes are also worthless IOUs, and that the phrase "backed by the full faith and credit of the United States of America" is nothing but a lie perpetuating a scam on a global scale.
7. FICA contributions are now capped at the first $113,700 of income earned by an individual. In 2010, 6.61% of Americans (individuals) made over $100,000 per year. That means that at least 95% of Americans pay FICA taxes on 100% of their income, while the upper 5% (the rich) pay an increasingly smaller percentage of their income in FICA tax. A single person earning $1.13-million a year would pay FICA tax on only 10% of their annual income. An individual earning $10-million a year pays FICA tax on about 1% of their income.
8. Raising the cap on income subject to FICA taxes to $250,000 would fully fund Social Security for the next 75 years.
9. Eliminating the cap on income subject to FICA taxes would - by some estimates - fully fund Social Security in perpetuity.
10. Social Security has never added a penny to the national debt.
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