don't ask howard to do THIS

[mopinko]

on another thread about the 'middle class tax cut" (senseless pandering to selfishness, imho) the suggestion was made to eliminate the cap on the "payroll tax". i am reposting this here as a separate thread. this is my absolute pet peeve, and, imho, marks the proponent as an idiot, unaware of the facts, and the history. this is the same thing as advocating the robbery of the social security system to fund the general revenue, something we have been bashing the rethugs for since st ronnie. can we please deep six this suggestion??!!??? here is my other post:


the "payroll tax" is NOT a tax!!!!!!!! it used to be called fica, the i of which stands for INSURANCE. the social security system is not a government welfare program, supported by taxes. it is a government run insurance program, supported by premiums. if you die or are disabled before you reach 65, it pays disability or survivors benefits. your eventual payouts depend on your premiums. there is a max on the premiums, because there is a max on the payouts. if you want to lift the max on the payouts, fine, lift the max on the premiums. but you will be able to hear the howling all the way to the MOON when rich people start getting social security checks that are in the 5 figures. otherwise DO NOT FUCK WITH THIS FUNCTIONING REMAINDER OF THE NEW DEAL!!!! and by the way- the cap on this tax is RAISED EVERY YEAR, with out fail, and without a word in the press. 15 years ago, the cap was about 50k, now it is 80k.
this is my one and only beef with molly ivins, and jim hightower. makes me want to throw a pie.

[maddezmom]

1. ya might want to edit

the profanity out of your post so it doesn't get locked. :)

[wtmusic]

2. Only part of the payroll tax is FICA

correct me if I'm wrong :-)

[Padraig18]

5. .0145 is Medicare witholding n/t

[mopinko]

12. medicare is separate

this used to be a part of fica, but it was broken out, so as to uncap it.

[mopinko]

8. only in the sense

that money that belongs in a "lockbox" is being diverted into the general revenue.

[HFishbine]

3. I don't think you can call people idiots either. (nt)

[Padraig18]

4. As a small business owner, your post is dead-on accurate.

The other post to which you refer made me FURIOUS in its naivete.

[HFishbine]

6. Explain

You know I respect your opinions Padraig, so maybe there is something I'm missing. The way I understand it, the SS fund was in surplus but has been robbed. Additionally, we have baby boomer retirement just around the corner, so your opinion please:

1) Is SS on shakey ground? Does it need some attention or is it sound as is?

2) Why exactly is it a bad idea to raise the income cap on FICA payments?

[Padraig18]

7. Al Gore had it right

The SS program needs to be in a lock box. Both parties have used it as as 'kitty' over the years, but due to increasing premiums, it has generally managed to remain actuarially sound to some degree; now, however, the * administration has begun a deliberate program of starvation for ALL social programs, SS included. They wish to lift the cap on pay outs but NOT on FICA. Simple bookkeeping will tell you why this is a bad idea.

Raising the income cap on FICA payments is extremely hard on small businesses, like my own; most people forget that there is an additional 6.2% SS an 1.45% Medicare premium payed in by the employer. Most small businesses do not have a profit margin large enough for an increase to NOT be destructive.

[mopinko]

9. like i said

<<2) Why exactly is it a bad idea to raise the income cap on FICA payments?>>

they do, every year. it is a stealth tax increase. i have never, ever heard a word about this in any media anywhere. but every single year, they raise the cap by a few thousand dollars. it is a fine idea, as far as i am concerned, cuz it will give me a higher check at 65. but since the money is not going into a "lockbox" it will lead to higher and higher commitment of general revenue to payouts. removing the cap all together will result in 5 figure checks for rich people in the future. there is a formula that is used to calculate your payments based on your input.

[WhoCountsTheVotes]

10. hmm, good point

I'm in favor of removing the caps, but capping the payouts. I can understand a more moderate position...

In any case, you're right that Social Security works just fine, and we must stop them from ripping off the system by using SS revenues for general expendiatures.

[mopinko]

11. no

I'm in favor of removing the caps, but capping the payouts.>>

this turns it into a simple income transfer/welfare program. NO, NO, NO. it is an insurance program, and MUST be retained, just like it was intended to be.
i am curious when it started being called the "payroll tax" this misnomer was the beginning of the end for a great and important program. made it just one more tax supported government handout, easily slashed in tough times.