“When you start funding Social Security that way, you basically destroy any notion that people really paid for their Social Security benefits,” he said. “We’ve got this political dynamic that says, ‘Well, if you don’t extend this, then you’re in favor of raising taxes on poor working people. If that’s the dynamic, then Social Security is in really severe trouble.”
When they started talking about reducing "payroll taxes" to act as a stimulus, a tax cut for the Working People, and a flood money into the economy, my jaw dropped and out came a big, "Huh???" They dropped the employee's share of FICA from 6.2% to 4.2% (they left the employer's share at 6.2% -- those evil capitalists don't need the help.)
I thought Social Securty was on the ropes!!! And we are reducing the funding for it by approx. 16%??? No one said boo about this. My jaw was still on the floor.
Only thing it showed me was that the FICA portion of the withholding taxes is just another federal tax and has nothing to do with Social Security. It is after all just a "payroll tax." Social Security funding is just another hog at the general fund's trough. Guess I am a little late coming to the table of understanding and the political games of taxes, social security and the welfare state.
The payroll tax reduction was just to be temporary. Now the far left party is screeming that to not extend the payroll tax reduction is "raising taxes on the Working People."
But if it is ok for the Working People, I guess I am on board.
