Free Republic

This should be a lesson to politicians and economists about the nature of gimmicky “stimulus� efforts …. but probably won’t be. In the pressure cooker of the tax fight over the holidays, most people forgot about the payroll-tax holiday — the reduction by two percentage points of FICA withholding for Social Security. Its backers claimed that putting $20 a week in the hands of earners would boost spending and the economy, which turned out to be entirely false. They then claimed that the expiration of this temporary stimulus would tank the economy through reduced spending.And that also turns out to...

WASHINGTON, D.C. – Americans support Social Security and are willing to pay more to preserve and even improve benefits, according to a new survey released today by the nonpartisan National Academy of Social Insurance (NASI). The new study, Strengthening Social Security: What Do Americans Want?, finds a sharp contrast between what Americans say they want and changes being discussed in Washington, such as cutting benefits by using a “chained” Consumer Price Index to determine Social Security’s cost-of-living adjustment (COLA). Large majorities of Americans, both Republicans and Democrats, agree on ways to strengthen Social Security — without cutting benefits. Fully 74%...

As much as I dislike seeing my taxes go up, I can not help but smile a bit at all the liberals who tripped over each other running to the ballot box in November to vote for Obama now scratching their heads wondering why their taxes went up. On Twitter Friday, the subject #WhyIsMyPaycheckLessThisWeek was trending. In truth, I probably should feel like crying that people are so blind to the policies and the results of the policies they support, but I’d rather take a more light-hearted approach at the beginning of the new year. Payroll taxes just took a...

Paycheck looking lighter? How are you adjusting spending after the payroll tax-hike? Contact jason.lange@thomsonreuters.com or @langejason

If Republicans and Democrats are serious about tax reform in 2013, they should throw away the tired old playbook and consider bolder ideas to fundamentally change the flawed tax code. One such idea would be to eliminate the payroll tax. The payroll tax -- 12.4 percent, split between workers and their employers to help finance Social Security -- is one of the worst taxes on the books for several reasons. A basic economic principle is that when the government taxes something, the nation gets less of it. Because the payroll tax makes it more expensive and administratively burdensome for businesses...

The expiration of the payroll tax cut would increase taxes by $115 billion in 2013, Maag writes, yet President Obama and others have been strangely silent – arguing instead about the fate of the 2001-2003 tax cuts. If a tax cut is scheduled to expire, but the focus of the debate is elsewhere, will people notice? Will the average family be surprised when their taxes rise by $1,000 or more next year, even if most of the rest of the 2001-2003 tax cuts are extended for all but the wealthiest Americans? That’s precisely what could happen to a family earning...

Trying to make sense of a senseless administration: Perhaps there are two kinds of people: gullible ones who listen to Barack H. Obama (D, Tupi, Brazil) and think his proposals make sense, and realistic ones who go into shock and outrage watching him misstate statistics on the television. Back in my days in international freight forwarding, I worked for a company that had cooperative agreements with other freight forwarders all over the world. If we needed to arrange an inbound shipment from Europe or Asia, we would tell our partner the details and they’d start it on its way. If...

Relieved congressional bargainers say they've reached agreement on compromise legislation extending payroll tax cuts and benefits for the long-term unemployed through 2012, edging a white-hot political battle a major step closer to finally being resolved. Rep. David Camp, R-Mich., and Sen. Max Baucus, D-Mont., the two top negotiators, strode from a conference room minutes after midnight Thursday to say that only technical issues and the drafting of legislative language remained. The bill would assure a continued tax cut for 160 million workers and jobless benefits for several million others, delivering top election-year priorities for President Barack Obama. "It's a very...

(Reuters) - Republican leaders in the House of Representatives on Monday dropped their demand for spending reductions to pay for extending a tax cut for 160 million American workers, setting up a likely breakthrough for agreement with Democrats. The about-face cleared the way for the Republican-led House to vote this week to renew for 10 months the tax cut set to expire on February 29. The Democratic-led Senate would likely support the payroll tax extension as laid out by the Republicans, even though they prefer including in the deal provisions on jobless benefits and payments for doctors treating Medicare patients...

So you think you got a payroll-tax holiday for free? Think that the big fat-cat mortgage lenders will foot the bill as part of Obama’s promise to make the cut pay for itself? CBS’ Sharyl Attkisson delivers the wake-up call to home buyers, who will pay a pretty penny for the latest gimmick of Obamanomics:CLICK ABOVE LINK FOR THE VIDEO Guess what? The fees collected won’t even cover the loss to the Social Security fund. It’s going into the general fund instead. Meanwhile, the Obama administration says to quit whining and suck it up so that we can recapitalize the...

On December 29th, 2011, the Federal Housing Finance Agency (FHFA) acting director Edward Demarco released a statement detailing the increase to the guarantee fee charged by Fannie Mae and Freddie Mac, as part of the Temporary Payroll Tax Cut Continuation Act of 2011. As part of the legislation, FHFA is increasing the guarantee fee by no less than 10 basis points (bp), effective April 1st, 2012. This increase affects all single-family residential mortgages, and the additional 10 bp in fees will be remitted to the U.S. Treasury instead of being retained by the GSEs. Additionally, the minimum initial increase shall...

WASHINGTON (AP) -- When last seen in Washington, House Republicans were furious with their own leader, Speaker John Boehner, and angry with their Senate Republican brethren over how the showdown over the Social Security tax cut turned into a year-end political debacle. The holidays and three weeks away from the Capitol have tempered some of the bad feelings, but several GOP lawmakers' emotions are still raw as Congress returns for a 2012 session certain to be driven by election-year politics and fierce fights over the size and scope of government and its taxing, spending and borrowing practices. In the week...

Two words: “Speaker Cantor.�Seriously, though, I’m skeptical that he’d do this. House Speaker John Boehner, hoping to spare fellow Republicans a second embarrassing defeat over payroll tax cuts, is prepared to navigate around rebellious Tea Party-aligned lawmakers to get a deal, according to congressional aides…Boehner’s office would not comment on possible divisions among Republicans in the upcoming debate over the payroll tax cut or tactics to get a bill passed. But one House Republican leadership aide told Reuters: “I think Boehner will seek a more accommodating approach to get a good percentage of Democrats to vote for it – even...

Democrats believe their chances of recapturing the House have improved significantly after what was widely seen as a GOP meltdown in the payroll tax debate. Democrats believe the messy fight has helped narrow the advantage Republicans have traditionally held on tax policy. Democrats have long espoused populist tax policy, with mixed results in recent years. Democratic strategists think that is about to change as high unemployment rates have given new traction to their proposals, which Republicans dismiss as class warfare. Tad Devine, a Democratic strategist, said he believes Democrats can recapture the House in part because of growing public resentment...

Flush from last night’s victory, Harry Reid floated the possibility at a press conference this morning that Dems could revive the idea of a millionaire surtax when the talks begin over the year long payroll tax cut extension next year. “I’ve talked to Senate Republicans, plural, who think there should be a fair tax on rich people,” Reid said. “I’m going to make sure that my conferees understand that this could be part of what we try to do.” Given that Dems dropped the millionaire surtax during the talks over the payroll tax cut earlier this month, you’d be forgiven...

House speaker John Boehner is set to sign an offer from Obama to accelerate negotiations. Republicans in the House of Representatives have capitulated in the showdown over the payroll tax, handing Barack Obama an important victory going into election year. Under pressure from other senior Republicans for blocking a bill that would extend tax cuts to millions of Americans, the House speaker, John Boehner, is backing away from his insistence that any deal must cover a full year. A deal agreed by Republicans and Democrats in the Senate on Saturday covers two months, to allow further negotiations in January. It...

Officials from the policy-neutral National Payroll Reporting Consortium, Inc. have expressed concern to members of Congress that the two-month payroll tax holiday passed by the Senate and supported by President Obama cannot be implemented properly. Pete Isberg, president of the NPRC today wrote to the key leaders of the relevant committees of the House and Senate, telling them that “insufficient lead time” to implement the complicated change mandated by the legislation means the two-month payroll tax holiday “could create substantial problems, confusion and costs affecting a significant percentage of U.S. employers and employees.”

Sen. John McCain, D-Ariz., lit into President Barack Obama today for failing to produce an agreement on extending the payroll tax cut, The Hill reports. The Senate passed a compromise two-month extension Saturday, but the House rejected it Tuesday amid objections from conservatives who want a one-year extension. Obama needs to exhibit leadership to break the stalemate, McCain told CNN. The president has merely told the House to pass the Senate bill. "Previous presidents I've served under ... would be calling them [members of Congress] over to the White House, looking them in the eye and telling them, 'We need...

RICHMOND, Va. -- Former House Speaker Newt Gingrich said Thursday he would tell his caucus to get "noisy" if he were trying to game out the dispute on a payroll tax cut with President Obama. Asked about the standoff by a voter, the Republican presidential candidate also called the senators "arrogant" over their refusal to negotiate. “I would have all of my members on talk radio back home demanding the senators come back. And I could say 'How can the senators arrogantly go home." Gingrich, who has previously said he doesn't know what John Boehner is going through because President...

Just across from National Journal. Our dumb national nightmare is over. House Republicans on Thursday crumpled under the weight of White House and public pressure and have agreed to pass a two-month extension of the 2 percent payroll-tax cut, Republican and Democratic sources told National Journal…The House will pass the two-month extension with a technical correction to the language designed to minimize difficulties businesses might experience implementing the short-term, two-month tax cut extension. In exchange, Reid agreed to appoint several Senate Democrats to start negotiating with the House on a full-year payroll-tax holiday extension, which is right in line with...

Senate Minority Leader Mitch McConnell (R-KY) has just offered a way out for House Republicans, who are badly losing the public relations war over the payroll tax cut. He's calling on Speaker of the House John Boehner to give in and pass a bill to extend the payroll tax cut — implicitly the bill that passed the Senate by an 89-10 margin on Saturday. As a compromise, he also calls on Senate Majority Leader Harry Reid to appoint negotiators on a year-long extension of the payroll tax cut — which Reid has already pledged to do once the House passed...

The standoff over preserving a tax break continued as House Speaker John Boehner showed little sign of reversing course despite sustained criticism from his own party and President Obama. Boehner assembled his top negotiators for a second day at an otherwise empty Capitol, but their position is being overpowered by the risk of a looming tax hike on Jan. 1. Obama planned to showcase stories of workers who will lose $40 a paycheck later Thursday at the White House.  “We’re fighting to do the right thing,” said Boehner, who wants to launch formal negotiations with Democrats to resolve differing approaches...

On December 20, the House of Representatives refused to pass the Senate’s 2-month Social Security payroll tax cut extension. This created the genuine possibility that this temporary 2.0 percentage point cut in the 6.2% Social Security tax normally paid by employees would expire at the end of this year. It became clear before the financial markets opened in New York on December 20 that the tax cut extension would be defeated. The Dow Jones Industrial Average (DJI) opened sharply higher and ended the day up 2.9%. The action in the European markets suggested that it was the news of the...

Yesterday the House voted to reject a Senate plan for temporarily extending the payroll-tax cut and subsequently moved to recess, and they deserve credit for doing so. This move does not eliminate the possibility of extending the tax cut, which expires at the end of December: The House previously passed a bill extending the cut for a full year, and that bill is good policy. It doesn’t increase the deficit. It forces a decision on the Keystone XL pipeline. And it’s President Obama’s major year-end priority. So why is the Democratic Senate blocking the bill’s path between Capitol Hill and...

PARKERSBURG - A temporary extension of the Social Security payroll tax has infuriated a West Virginia senator. Sen. Joe Manchin said the two-month extension is a failure for the American people. "I am furious and disgusted that anyone could imagine this stopgap measure is the best that Congress could offer hard-working Americans, seniors and the unemployed," Manchin, a Democrat, said. "Delaying a decision for another two months makes no sense, especially when Congress will not be working for one of those months. Only in Washington would you get a month off for failing to do your job. West Virginians and...

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...

Once again, Congress is playing high-stakes poker with a precarious economy and the lives of struggling Americans who live paycheck to paycheck - that is, if they're lucky enough to have a job. [Snip] In a mean-minded, take-it-or-leave-it ultimatum to the "people's House," Senate Majority leader Harry Reid made it clear he didn't care what the House did with the bill - the Senate was finished for the year. That's not the way Congress usually has operated over its 222 years, especially on must-pass legislation that may affect the lives of 160 million working Americans. In such cases, the Senate...

(Reuters) - If Congress misses its New Year's Eve deadline to renew a payroll tax cut and jobless benefits by a few weeks or a month, damage to the economy could be reversed in fairly short order, economists and analysts say. As the odds of a missed deadline rise, several economists said the economy could survive nearly unscathed if there is a short delay in extending the payroll tax break for 160 million workers and unemployment insurance for millions. "If it is a week or two, it is annoying but the impact would be fairly small," said Nigel Gault, U.S....

The conservative Wall Street Journal editorial board is slamming House Republicans today for their hard-line position on the payroll tax cut, writing that GOP lawmakers are throwing the 2012 election to President Barack Obama before it even begins. House Republicans are refusing to pass the bipartisan two-month extension of the tax cut that passed the Senate on Saturday, demanding a year-long increase. But Senate Majority Leader Harry Reid says he'll only reopen negotiations on a longer deal once the House passes the Senate bill — and removes the immediate threat of a tax increase for most Americans. [Snip] The Journal's...

President Obama's Hawaii Christmas vacation dilemma By Amie Parnes and Jeremy Herb - 12/21/11 05:10 AM ET President Obama faces a most difficult decision with the payroll tax extension up in the air, and it isn't whether to compromise with Republicans. The toughest call for the president this holiday season may be whether to join his family for Christmas in Hawaii or stay in lonely Washington. The White House won't say whether the president is heading west for the holidays—or even if he’s making an abbreviated appearance. Jay Carney, the White House press secretary, said Tuesday that Obama “intends to...

I guess it wouldn't be Christmas without some brinksmanship all the way to New Year's Eve. Last year that brinksmanship involved the extension of Bush-era tax rates and unemployment benefits. This year, thanks to a very curious reversal, it will be the payroll-tax holiday -- or more precisely, its length: The House voted Tuesday to disagree with the Senate-passed payroll tax bill, and to call for a House-Senate conference to sort out differences between the bills.The move is intended to put pressure on Senate Democrats to reconvene and meet with the House over the bill, even as Democrats say the...

Officials from the policy-neutral National Payroll Reporting Consortium, Inc. have expressed concern to members of Congress that the two-month payroll tax holiday passed by the Senate and supported by President Obama cannot be implemented properly. Pete Isberg, president of the NPRC today wrote to the key leaders of the relevant committees of the House and Senate, telling them that “insufficient lead time” to implement the complicated change mandated by the legislation means the two-month payroll tax holiday “could create substantial problems, confusion and costs affecting a significant percentage of U.S. employers and employees...” The NPRC ... represents organizations that provide...

WASHINGTON (Reuters) - The top Democratic lawmaker said on Monday that he would not start negotiating a one-year payroll tax cut extension until House Republicans passed the short-term tax cut that has already been approved by the Senate.

WASHINGTON — House Speaker John Boehner says he opposes a Senate-approved bill extending a payroll tax cut and jobless benefits for just two months and wants congressional bargainers to write a new measure that would last an entire year. The Ohio Republican said on NBC's "Meet the Press" on Sunday that the Senate's two-month bill would be "kicking the can down the road." He mentioned items in the House version of the bill that were not in the Senate legislation, including restrictions on Obama administration curbs on industrial pollution. Boehner's comments came a day after the Senate easily approved a...

WASHINGTON - Senate leaders reached tentative agreement Friday night on legislation to extend Social Security payroll tax cuts and jobless benefits for two months while requiring President Obama to accept Republican demands for a swift decision on the fate of an oil pipeline that promises thousands of jobs. Senate negotiators agreed to the two-month extension after failing to reach an agreement on extending the tax cut for another year, CBS News Capitol Hill producer John Nolen reports. A vote could be held as early as Saturday on the measure. Any deal would also require House passage before it could reach...

The Legacy Lives On! Mark’s Lost Dog & Cat Rescue Foundation “Conservatism is the antidote to tyranny precisely because its principles are the founding principles.” --Mark Levin in Liberty and TyrannyWelcome to “The Levin Lounge”… Step in and have a virtual FRink.Taking the country by storm, one radio station at a time – and kicking the BUTTS of the competition! Welcome all, to the most FUN LIVE THREAD on FreeRepublic.com! You can call Mark’s show: 1-877-381-3811

So here's the latest Democratic growth plan: Pay for a temporary tax cut that has already proven not to create jobs with a permanent tax increase that almost certainly will cost jobs. That's the essence of Senate Majority Leader Harry Reid's plan to finance a one-year payroll tax cut with a 3.25% income tax surcharge on upper-income Americans that would last for at least 10 years. Mr. Reid knows it can't pass the House, and as we went to press it looked likely to fail even in the Senate. But this is the way it goes in the Senate these...

The Senate rejected two different plans for extending the payroll tax holiday for another year, and it mostly went along party lines. At the bottom of it all was the usual discussion we’ve been seeing on every spending issue for some time now: whether to pay for it and how to do so if they would. The Senate late Thursday rejected competing partisan visions for extending a temporary tax break that benefits virtually every American worker, clearing the way for more serious negotiations over how to cover the cost of the tax cut.All but a handful of Democrats voted in...

Senator Dick Durbin (D, IL), in his regular email blast, reports that “the GOP is threatening to throw working families under the bus – again.” Now, coming from the majority whip of the party that singlehandedly drove American manufacturing overseas with its crippling taxes and strangling regulations, this is quite a cocky claim. But he goes on. “This week,” he continues, “Republicans are poised to vote to force average working families to pay $1,000 more in taxes next year by blocking an extension of the payroll tax holiday instead of asking the wealthiest Americans to pay their fair share on...

A year ago, the Bush tax cuts were set to expire. Barack Obama insisted that only those for people making less than $250,000 per year should be extended. Even though Democrats still controlled both the House and Senate, Republicans had enough clout to delay action until the last minute. At that point, they held all the high cards because they knew that Obama couldn't risk a large de facto tax increase on every taxpayer at a time when the economy was weak. He caved and agreed to extension of all the Bush tax cuts, including those for the rich. Today...

The congressional "super committee" officially admitted failure, but even as it did so, Congress plunged toward a new budget battle that carried an immediate punch: A year-end fight could bring a tax increase of nearly $1,000 to the average American worker. The current payroll tax holiday for workers expires Dec. 31, and unemployment benefits run out for some 2 million Americans shortly after that. Economists warn that a tax increase on Jan. 1 combined with an end to the jobless benefits could cut the economy's already weak growth almost in half.

In other words, they’re going to waste everyone’s time. (The Hill) – After failing to reach a deal to reduce the deficit, the Senate will move next month to take up legislation that could add more than $400 billion to the deficit. All of the proposals, such as the extension of the payroll tax cut and unemployment insurance, are popular but come with no agreement on how to pay for them. Senate Democrats will go on offense next week by forcing Republicans to vote on extending and expanding the payroll tax cut, which accounts for $240 billion of the tab,...

There's been a lot of discussion about the deficit super-committee lately, and whether the bi-partisan panel can come up with a package, or whether it's doomed for gridlock. But whatever they decide to do, the near-term impact on the economy will be pretty minimal. The automatic trigger cuts don't kick in until 2013, and they can be watered down. [Snip] But there is one decision that has to be made in a few weeks that absolutely would have an impact, and that's whether the payroll tax cuts that were agreed to late in 2010 will be extended again. Morgan Stanley...

Democrats are counting heavily on President Obama's upcoming Labor Day job creation speech to allay the fears of the stock market, the international investor community and the American people. Much like Waiting for Godot, there's been a lot of hype and chatter but very little action. In fact, considering Obama has no street creds in the area of job creation, and considering few of his advisors have ever created jobs, and considering that two of the most powerful Democrats in the House and the Senate represent the two states with the nation's highest unemployment, it's hard to imagine the president...

Let me get this straight: Republicans are arguing for a not-insignificant tax increase, and President Obama is sounding like Jack Kemp, saying higher taxes would lead to lower GDP growth. I knew I shouldn’t have followed that damned rabbit down the hole. As part of a harebrained attempt to stimulate the economy, a temporary reduction in the payroll tax was appended to the deal to prevent the Bush-era income-tax rates from expiring. There is good reason to think that these kinds of short-term stimulus measures don’t do much good. One of Milton Friedman’s key achievements was working out a formal...

Those of you still collecting a paycheck should have noticed an increase in what you took home starting in January of 2011. Unless you got a raise, you might not notice the difference. However, we did, and when my husband asked the payroll department at his company what caused the difference, all they could tell him was the tax rates were different. Of course I immediately wondered what was done, but could find no answers. Then my husband came across a small article in our local paper taken from the Wall Street Journal that told about the social security rate...

With perfectly flexible wages, it doesn't matter whether tax law says "employees pay" or "employers pay."  Tax incidence depends on supply and demand elasticity, not legislative intent. If wages are nominally rigid, however, the law matters.  If you cut a tax on employers, this reduces labor costs, increases the quantity of labor demanded, and reduces surplus labor.  If you cut a tax on employees, in contrast, this increases worker compensation, increases the quantity of labor supplied, and increases surplus labor. In both cases, admittedly, a tax cut might directly increase demand and, with nominal wage rigidity, increase employment.  But...

Hidden in ObamaCare, Section 8002, is a new payroll tax that will hit paychecks of American employees beginning 01/01/2011. It was placed in ObamaCare to make the legislation appear to cost almost $100 billion less than the true cost. That’s according to Ron Greiner of StopObamaCare101.com,a national medical insurance expert. The program is called the Community Living Assistance Services and Support Program (ironically dubbed: “CLASS Act”). Even the Chairman of the Senate Budget Committee (Senator Kent Conrad D-ND) called it, “A Ponzi Scheme of the first order, the kind of thing that Bernie Madoff would have been proud of.” (Charles...

Forty-nine percent (49%) of U.S. voters say working Americans should be allowed to opt out of Social Security and provide for their own retirement planning. A new Rasmussen Reports national telephone survey finds that 37% disagree and do not believe Americans should be able to opt out of Social Security. Fifteen percent (15%) are not sure. A majority of voters under 50 say workers should be allowed to opt out. A plurality of those over 50 disagree. One of President Obama’s top economic advisers signaled this week that the president will try to reform Social Security before the end of...

House Democrats on Tuesday unveiled sweeping health-care legislation that would hit all but the smallest businesses with a penalty equal to 8% of payroll if they fail to provide health insurance to workers. The House bill, which also would impose new taxes on the wealthy estimated to bring in more than $544 billion over a decade, came as lawmakers in the Senate raced against a self-imposed deadline of this week to introduce a bill in time for action this summer. Senators face a tougher battle because they are striving for a bipartisan bill. Key senators are weighing a combination of...