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If you want to put more money into middle class - why was the 4% tax increased to 6% on the first $110K you make?
What better stimulus does the economy need if everyone making less than 110K gets an additional 2K in their pocket?
Am frustrated with the lack of common sense approach in Washington and also, with Democrats/Republicans paying lip service and not making any serious effort and dropping the ball on this!
It wasn't increased; it reverted back to where it was 2 years ago.
That was a "tax holiday", not a tax change and was only supposed to be in place for 1 year.
FICA funds your future retirement. We should have been upset that it was lowered to begin with.
If anything it should be raised IMHO. With pensions gone and 401K savings lackluster, future generations are going to depended on SS as their primary retirement income, not as supplemental retirement income.
And 2% doesn't amount to much really if you do the math..$20/week for a $50K/year salary.
HappyTexan, I think that you are exactly right. We ned to be increasing SS, not de-funding or "reforming" it. A good place to start would be to increase the employer's contribution in order to recapture some of the money that they have stripped from so many American workers by doing away with defined-benefit pensions.
HappyTexan, I think that you are exactly right. We ned to be increasing SS, not de-funding or "reforming" it. A good place to start would be to increase the employer's contribution in order to recapture some of the money that they have stripped from so many American workers by doing away with defined-benefit pensions.
There are a number of possible/probable unintended consequences from doing that. One of is the incentive it would give employers to contain/contract wage growth to minimize the amount the increased rate is applied to. Also many companies would like any other production cost pass the increase on to their consumers thus increasing the amount of cost push inflation in the economy.
HappyTexan, I think that you are exactly right. We ned to be increasing SS, not de-funding or "reforming" it. A good place to start would be to increase the employer's contribution in order to recapture some of the money that they have stripped from so many American workers by doing away with defined-benefit pensions.
ummmm......no. Keep in mind some employers are going to be saddled with the ObamaCare costs on top of regular costs of doing business in a weak economy. Everyone loves to think "the boss, the company" is getting filthy rich off the work they do, that they are underpaid, etc. They look simply at their net paycheck, not their total cost of being an employee. I love to tell people with that attitude to simply quit, go out and hang their own shingle, why let the boss/the man/ the company hold you back?
In an industry I am familiar with, a 33K employee costs 39K a year with NO health insurance provided (workers comp + FICA/Payroll). So regardless of their net pay, their true cost to the employer is 39K. So 6K cost is $500 a month/$125 a week for the employer cost to have that employee. Now add the potential cost of ObamaCare and your proposed increased contribution and it would be really easy for the employer to consider moving the whole operation out of the country!
Yeah, this is my biggest problem with "tax holidays". Everyone thinks that when they expire, the government is "raising taxes". It isn't a tax raise, it is just an expiration of a temporary tax break. It was never meant to be permanent. Other than this holiday, the rate has been 6.2% since 1990. In fact, this is already BY FAR the longest period of time that has passed between increases since the beginning of the program in 1937. We have been 22 years with no increase. The next longest period was at the very beginning of the program, the original rate stayed the same for the first 13 years of the program. After that, increases were taken every few years until 1990.
Over in the politics forum we're debating this and this is what I found out when I googled something.
That FICA tax holiday cost us big time.
Recall that the Fed was going to put money into FICA to make up for the 2% we were getting back.
So the Fed borrowed $120 billion and got back $12 billion in GDP growth.
It didn't work obviously. But now we are saddled with $120 billion loan accruing interest.
It was a loser proposition right off the bat and we did it for 2 years.
And people are upset that it's gone. It didn't work and cost us more to put that $20/week in your pocket.
it was possibly the dumbest thing ive ever seen. i understand some of the thought process, but ultimately social security needs the money. i guess if you figure all government money is fungible it doesnt matter but it seems like you should be taking the money from general taxes rather than taxes specifically for social security which is already operating at a $40+ billion annual deficit.
A good place to start would be to increase the employer's contribution in order to recapture some of the money that they have stripped from so many American workers by doing away with defined-benefit pensions.
And if you are self-employed you will see higher taxes, and never had a pension plan to begin with.
For a reality check, look at income distribution trends over the last 50 years, look at corporate profits, and look at executive compensation. And yet so many people put their heads into the sand, refusing to recognize this, defending the sharks who are eviscerating them. The modern Anglo-American corporation has become nothing but a bloodsucking shark with one and only one goal -- the maximization of profits irrespective of any damage done to our population. Over the last thirty years a very large gap has opened between productivity and wages, the net result being the creation of a super class (the top one tenth of one percent of the population).
One aspect of this has been the decimation of defined-benefit pension plans and the secure retirements of millions of American workers in order to keep profits continually growing. In order to counter this to some extent, most developed countries have a national pension plan. We could have the same in the United States, funded by employer contributions to SS that compensate for the expropriated defined-benefit pension money.
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