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Tax Cut? No, Just Another Raid On Social Security
Investor's Business Daily ^ | 20 Dec 2011 | Editorial

Posted on 12/21/2011 1:26:04 PM PST by IBD editorial writer

Politics: Lost in Beltway wrangling over a payroll tax cut, an ugly reality lurks: Our politicians are plotting yet another raid on the Social Security "trust fund," which is already near insolvency. When will this madness stop?

President Obama and his congressional Democrats know well how bad their spendthrift reputation is among voters as election day approaches. With Obama at sub-50% approval numbers and Gallup reporting Congress clocking in at a record-low 11%, they expect a bloodbath at the polls in November — and maybe another slashed debt rating, too.

What then could be better for Democrats than to be able to claim that deep down, they're tax cutters, too? Just like Republicans — whose corporate tax cuts in 1982 led to an unparalleled decade of economic growth.

But Obama and his Democrats don't want to direct any tax cuts toward investment for long term growth — as corporate tax cuts do — but to hand them out to taxpayers like party favors in the hopes it'll pay off come November. It's a political game, but they have few other options aside from cutting spending.

But there's a big catch: The payroll tax cut they seek is nothing more than taking cash from the back pockets of taxpayers and handing it to them up front.

(Excerpt) Read more at news.investors.com ...


TOPICS: Editorial; Government; Politics/Elections
KEYWORDS: bankrupt; payrolltax; socialsecurity; taxcut
The whole tax-cut thing the GOP is taking flak for is completely bogus. Dems are making a new raid on our Social Security funds and telling us it's a tax cut.
1 posted on 12/21/2011 1:26:05 PM PST by IBD editorial writer
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To: IBD editorial writer

Less money in contributions while SS payouts get COLAS. Yeah, and if I lower my contribution to my 401k I’ll get a better yield.


2 posted on 12/21/2011 1:33:18 PM PST by massgopguy (I owe everything to George Bailey)
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To: IBD editorial writer

As an insider, exactly how long do you think it will be before the media as a whole begins to experience the results of their lack of integrity and objectivity?

....or if that final slow turn down the shi**er is already underway.

(I know our local “news”paper has lost so much circulation, they can only justify their ad rates by giving papers away, and they’re not getting many takers for that deal.)


3 posted on 12/21/2011 1:35:54 PM PST by Unrepentant VN Vet ((395 and a wakeup) Truth, I know, always resides wherever brave men still have ammunition.)
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To: IBD editorial writer

Alert the old folks!


4 posted on 12/21/2011 1:37:33 PM PST by pallis
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To: IBD editorial writer

I have an idea:

If the Democrats think this “tax cut” is good for the economy, why not make it for the full FICA withholding amount of both individual and employer and make it permanent. Then, those who paid into it all their lives and ready to retire will have sufficient amount in their part of the “lock box” to collect it as planned. Those people who contributed a percentage their working years will get that percentage of back from the “lock box” at retirement and then they can use the remaining working years to build a real retirement savings.

Social Security problem solved.

What? No “lockbox”? My, that is a problem, huh?


5 posted on 12/21/2011 1:39:00 PM PST by Proud2BeRight
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To: IBD editorial writer

Has the Social Security tax ever been reduced before? Apparently once it is “temporarily” reduced, it can never be raised again. The FICA tax is the only income tax that most people pay. In order to win votes the politicians will probably lower it to zero.


6 posted on 12/21/2011 1:41:43 PM PST by forgotten man (forgotten man)
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To: IBD editorial writer

Why do they keep calling it a SS ‘trust fund? There is no ‘trust’ and there is no ‘fund’.

The SS benefits are just coming from issuing new national debt. Just using the term is giving up.


7 posted on 12/21/2011 1:46:04 PM PST by sickoflibs (You MUST support the lesser of two RINOs or we all die!)
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To: IBD editorial writer

The last line: “So let’s call it what it is: A tax hike on the young to pay those already working, with the added kicker of an empty pot at the end of the Democrat rainbow.”

BUT that is nothing new. SS was a transfer tax, welfare, and vote buying scheme from the get go. There is no trust fund in any sort of normal financial sense of the term.

Make the cuts bigger and permanent. The terms “trust fund”, “contribution”, “broke”, “insolvent”, ‘earned”, and etc. do not apply to SS. Those terms apply to trust funds and pensions that have legal (as opposed to political) agreements funded by tangible investments (as opposed to US Treasury securities which are only paper claims made against future tax receipts and enforced by politicians). They do not apply to SS which should use the terms TAX and SPEND.


8 posted on 12/21/2011 1:46:56 PM PST by FreedomNotSafety
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To: IBD editorial writer

how do they get away with calling this a tax cut? They raise taxes on other people “to pay for it”!

They should call this an attack on seniors, bankrupting SS, a direct attack on seniors health care etc., like the Dems always love to do.


9 posted on 12/21/2011 1:48:41 PM PST by snowstorm12
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To: Proud2BeRight

Darn good idea. Best one of the week. I am all in. how do we start the ball rolling?


10 posted on 12/21/2011 1:52:14 PM PST by FreedomNotSafety
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To: IBD editorial writer

There is no trust fund, therefore taxes are just taxes. The idea that Social Security taxes are somehow different is a fiction.


11 posted on 12/21/2011 1:53:29 PM PST by Hugin ("Most time a man'll tell you his bad intentions if you listen and let yourself hear"--Open Range)
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To: IBD editorial writer
The whole tax-cut thing the GOP is taking flak for is completely bogus.

So, why are the Republicans sitting back and taking the flak? Never mind, the question was rhetorical.

They should be screaming it at every change they get that this is harming Social Security and is not economically stimulating in the least.

12 posted on 12/21/2011 1:58:14 PM PST by BfloGuy (The final outcome of the credit expansion is general impoverishment.)
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To: allmendream

ping


13 posted on 12/21/2011 2:12:34 PM PST by Principled
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To: sickoflibs
The SS benefits are just coming from issuing new national debt.

Indeed. The payroll tax revenues are swapped for new debt as it comes in. This just makes us run out of cash more quickly imo

14 posted on 12/21/2011 2:15:28 PM PST by Principled
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To: snowstorm12
how do they get away with calling this a tax cut? They raise taxes on other people “to pay for it”!

Welcome to the world of redistribution. Believe it or not, some people still don't get it.

15 posted on 12/21/2011 2:16:42 PM PST by Principled
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To: Proud2BeRight
If the Democrats think this “tax cut” is good for the economy, why not make it for the full FICA withholding amount of both individual and employer and make it permanent.

May as well! At least such a significant, permanent cut WOULD stimulate the economy some. I'd like to see permanent INCOME tax cuts!

16 posted on 12/21/2011 2:18:13 PM PST by Principled
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To: IBD editorial writer

Paging AARP.....


17 posted on 12/21/2011 2:19:30 PM PST by mewzilla (Santelli 2012)
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To: Hugin
The idea that Social Security taxes are somehow different is a fiction.

Well, nearly half of tax payers pay only SS taxes. The other appx half ALSO pays income taxes. Seeing as we're not rolling in cash, this shortfall will have to be made up promptly by those who pay income taxes.

Li'l ole redistribution plan... cut 14% of payroll of 100% of workers... then have just the top 50% pay it all back!

18 posted on 12/21/2011 2:21:40 PM PST by Principled
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To: mewzilla

AARP is a big left wing supporter. I’ll never join.


19 posted on 12/21/2011 2:25:07 PM PST by Terry Mross (I'll only vote for a second party)
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To: Terry Mross

The ruling class took, what, about 500 mil from Medicare to fund Obamacare? Nuthin’ from AARP. Now they’re sacking Social Security again in order to bribe voters. Still not a peep outta AARP. Jeez louise, where are greedy geezers when ya need ‘em?!


20 posted on 12/21/2011 2:29:02 PM PST by mewzilla (Santelli 2012)
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To: IBD editorial writer
Every Year the trustees of the Social Security "Trust Fund" issue a report on the fund's financial health and when the so-called trust funds will be depleted. In the 2007 report, under intermeddiate assumptions, the trustees reported the Old Age and Survivor's Insurance Trust Fund would be depleted in 2042. In their 2011 report, the Trustees estimated the fund would be depleted in 2036. With the ongoing unemployment, the reduction in revenue collection due to the "tax holiday", a contuing decline in fertility rates and increase in life expectancy, I would not be surprised to see the depletion date moved up to 2030 - 2032 in the 2012 report (traditionally released in May). These dates could be devestating in an election year.

According the the latest life expectancy figures (which are from 2007), life expectancy at age 65 is about 18 years or until age 83 (life expectancy is about 78 years at birth).

Therefore, if the 2030 date should prove accurate, for the first time in history, in 2012 anyone who has not reached the full retirement age of 66 (the point at which they can collect unreduced benefits) can expect to see the trust fund completely depleted within their lifetime.

This is an issue that republicans must shout from the rooftops. If my guesstimates are anywhere near correct, during Obama's first 4 years the depletion date of the trust funds has moved 12 years closer, and the trust fund will be depleted within the predicted lifetime of every man, woman and child who is not already receiving unreduced Social Security Benefits.

THAT is Obama's idea of a "holiday"!

21 posted on 12/21/2011 2:46:19 PM PST by In Maryland ("Truth? We don't need no stinkin' truth!" - Official Motto of the Main Stream Media)
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To: IBD editorial writer

Since not one republican complained when these were called “taxes”, then it’s not likely they’ll win the war over this being a “tax cut”.

However, isn’t the amount paid in related to the amount paid out.

Republicans should be calling this a benefit cut....and use future dollars to explain how the $17 cut today for a new worker equals $120 less (whatever the number) in benefits down the road.

They should be hitting the democrats for cutting workers’ social security checks before they’ve even gotten them.


22 posted on 12/21/2011 3:02:12 PM PST by xzins (Pray for Our Troops Remaining in Afghanistan, now that Iran Can Focus on Injuring Only Them)
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To: IBD editorial writer
Chuck you Schumer is head spinning on FOX. He said that if the Repubs
cannot pass a two month extension how can they be trusted to pass a one year extension.
Then he started laughing at his own BS spinning.

My god how are these people getting away with all this BULL!


2012 will be the nastiest year of politics in my lifetime.
They certainly know how to cower the Cowardly Repubs.

23 posted on 12/21/2011 3:26:36 PM PST by MaxMax
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To: IBD editorial writer

I think I heard Rush say there was a AP Story about a new tax hidden in this bill. From what he was said there will be a $17.00 per month tax added to mortgages loans for homes valued over $200.000.00. Can anybody confirm?


24 posted on 12/21/2011 4:20:14 PM PST by steveab (When was the last time someone tried to sell you a CO2 induced climate control system for your home?)
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To: IBD editorial writer

I think I heard Rush say there was a AP Story about a new tax hidden in this bill. From what he was said there will be a $17.00 per month tax added to mortgages loans for homes valued over $200.000.00. Can anybody confirm?


25 posted on 12/21/2011 4:32:44 PM PST by steveab (When was the last time someone tried to sell you a CO2 induced climate control system for your home?)
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To: steveab

Yes it’s true.


26 posted on 12/21/2011 5:55:19 PM PST by sheana
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To: forgotten man

I believe the plan is to eliminate the ‘EMPLOYEE PORTION’ of the social security tax. Most people swallow the absurdity that the employer pays half of the tax when in reality it simply means that they are paid less than they would be paid if the whole amount were deducted from their pay. Once the ‘EMPLOYEE PORTION’ is eliminated most people will think they are not paying anything so they have no right to demand to receive benefits when they reach retirement age. Then it will become ‘means tested’, at this point the people who are employers and are still paying the ‘employer portion’ on all their employees will NOT be entitled to draw benefits as in most cases their income will be too high to qualify. Only those who think they are not paying in any tax will qualify for benefits. I really don’t know of any other reason to do what they are doing.

All this is a long winded way of agreeing with what you said, “In order to win votes the politicians will probably lower it to zero.”


27 posted on 12/21/2011 7:47:51 PM PST by RipSawyer (This does not end well!)
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To: Proud2BeRight
Brilliant!

Take the "tax cut" and make it permanent - a permanent "savings" for working individuals to have their own "retirement savings," didn't Bush propose just such a deal to "save Social Security?".

Didn't liberals excoriate Bush for "stealing" from SS recipients??????

28 posted on 12/21/2011 8:08:25 PM PST by zerosix (native sunflower)
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To: sheana

“Yes it’s true.”

So the real reason of this Temp Tax Bill is to hid a Added Value Tax that will fund Bigger Government. I wonder how many of our Elected Reps knew about about this tax? Which leads me to the next questions. If they knew why did they vote for it? If they didn’t know about it, why didn’t they know about. I don’t know about you but I’m going to get an answer from my Reps.


29 posted on 12/21/2011 8:42:13 PM PST by steveab (When was the last time someone tried to sell you a CO2 induced climate control system for your home?)
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To: Proud2BeRight

Actually, it would work. As arranged, SS just has to cash in special Treasury Bonds to cover those now on the dole. Sure, that amounts to sucking money from the general fund, but that’s just doing what it was designed to do. At least could legally start weaning the population off SS.


30 posted on 12/21/2011 9:02:01 PM PST by ctdonath2 ($1 meals: http://abuckaplate.blogspot.com/)
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To: steveab

It was the Republicans who put it in the bill. It was their way of funding the ‘payroll tax cuts and u/e extension’ instead of taxing millionaires and billionaires which the Dems wanted to do.


31 posted on 12/22/2011 8:04:19 AM PST by sheana
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To: sheana

“It was the Republicans who put it in the bill. It was their way of funding the ‘payroll tax cuts and u/e extension’ instead of taxing millionaires and billionaires which the Dems wanted to do.”

I Wouldn’t doubt it. There will be more “Added Value” taxes and the Elected Elite will want to hid that as much as they can. It’s time to throw the tax code out and start over where everybody has much skin in the game as the next.


32 posted on 12/22/2011 5:04:33 PM PST by steveab (When was the last time someone tried to sell you a CO2 induced climate control system for your home?)
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