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Political fix; Editorial; Beaver County Times; May 28, 2010.
In case you missed it, the purpose of the editorial is to blame Republicans if Socialist Security doesn’t get fixed.
Did you note how the editorial attempted to hide the magnitude of the proposed tax increase? The editorial wrote about “immediately increasing payroll taxes for workers and employers by 1.1 percentage points each to 7.3 percent.” First, the employee pays the full SS tax, currently 12.4%. The myth employers pay half is simply accounting sleight of hand mandated by law to understate the actual impact on the employee. The same is true for the Medicare tax. Second, “1.1 [really 2.2] percentage points” doesn’t sound like much, does it? Do a little grade-school arithmetic, however, and you find increasing the current SS tax from 12.4% to 14.6% represents an increase of 17.7%! This would bump the total payroll tax (SS + Medicare) to 17.5% right off the top of your paycheck.
The editorial said the subject Senate Special Committee on Aging report claimed increasing the SS tax rate would more than close the gap (104%). The editorial failed to note we’ve been told that before. Since 1950, Congress increased the Socialist Security tax rate 20 times! Each time we were told the increase would make SS solvent. At 12.4%, the current level is 6.2 times its original 2% rate. Further, the max taxed earnings cap increases every year by law and is now more than twice what it was only 20 years ago in 1990 ($51,300). In constant dollars, the original earnings cap of $3,000 in 1937 should be $45,419 today, not the $106,800 it is in 2010. SS is a Ponzi scheme and no level of taxation can fix it.
Despite all the evidence increasing the SS tax rate is a bad thing and won’t work anyway, nevertheless the Times thinks it’s a bad thing enough Republicans won’t go along with this folly “so that the reform could be called truly bipartisan.” Oddly, the editorial admitted “we the people” don’t want the tax increase either when it said “But if they [Democrats] raise payroll taxes, they will get hammered at election time by their Republican opponent.” If Americans think increasing the SS tax rate is the right thing to do, members of Congress (Democrat or Republican) who vote for the increase can’t “get hammered at election time by their” opponent.
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