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Too bad they did take up the reform when bush proposed it and democarts actaully cheered kiling reform. Now it is much worse offf and the nworse for evryone.Kickig the can down the road always is harder ;ask the Greeks.In fact the CEO of IBM sadi just today that the US can endup like greece i the future easily.
This will be a multiple hit not just on individuals but state, local govt and corporate America. Pensions are a major purchaser of corporporate, state and local bonds. They have deferred income invested with ROI and contributions from state and local government previously made. Pull those trillions out of current and future distribution and writing them up as previous consumption will also be occuring. That is money in the equity markets from individuals that pensin funds are investing that the individuals who contributed them probably would not have. What would the feds do without SS contributions to help fund current government spending? Would people be allowed to die without assistance or would the cost for non contributory medical assistance skyrocket? The United States seeks to claim a moral high ground and leadership role in the world. That comes with a price and we are increasingly either unable or unwilling to pay that price and will be surrendering tha role. It is a double edged sword as pensions are both a major current contributor to the economy and also a long term challenge to the economy. http://in.reuters.com/article/2012/0...8HB3KG20120611
Eliminate the cap and allow the rich to pay in like the rest of us
There is a perception that eliminating the wage cap on FICA taxes would put Social Security on easy street, but I am not convinced. I have not seen any numbers attached to that change by someone who doesn't have an agenda. Here is my reasoning: The median family income in the United States is on the low side of $50,000. The cap is currently somewhere around $108,000. Just how many individuals are there who make more than $108,000 per year? Not enough would be my guess. Obviously removing the cap would give SS more cash flow, and I am not against that. I am just questioning how far such a move would go towards solving the problem.
There is a perception that eliminating the wage cap on FICA taxes would put Social Security on easy street, but I am not convinced. I have not seen any numbers attached to that change by someone who doesn't have an agenda. Here is my reasoning: The median family income in the United States is on the low side of $50,000. The cap is currently somewhere around $108,000. Just how many individuals are there who make more than $108,000 per year? Not enough would be my guess. Obviously removing the cap would give SS more cash flow, and I am not against that. I am just questioning how far such a move would go towards solving the problem.
Thanks. Ten percent is more than I would have guessed. What that means is I need to modify my scepticism as to how effective removing the cap would be. It might be fairly effective, especially if the pay-out cap remained in place.
On the other hand, we can think about it this way: Of the ten percent who make over the cap, many probably make just barely over, say $5,000 or less over. That limits the amount of extra revenue coming into Social Security. I'm sure someone has crunched these numbers, and that's what I would like to see.
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