Posted by AccountingWEB on 02/23/2012 - 13:05
Okay, so the Middle Class Tax Relief and Job Creation Act of 2012 extends the payroll tax reduction through 2012. Will someone please tell me how the so-called payroll tax holiday makes sense? I see our Congress concentrating on re-election and voting to keep payroll taxes artificially low for people who are among the lucky ones who still have jobs. The reduced payroll taxes remove billions of dollars from a social security program that is already struggling to position itself to handle the throngs of baby boomers who are about to drain the program.
In addition, this "holiday" piles more responsibility on the youth of America who will have to somehow manage to find jobs (latest figures show roughly half of recent college graduates are without work) and who will have to pay more to fund their own unlikely retirement all while struggling to help their ailing parents who didn't put enough away to protect themselves in old age. I could actually see taking that estimated $1,000 per worker in reduced payroll taxes and investing that in a locked down retirement fund that can't be accessed until the owner is over age eighty, but beyond that, I'm having trouble seeing the logic in this legislation.
In addition, this "holiday" piles more responsibility on the youth of America who will have to somehow manage to find jobs (latest figures show roughly half of recent college graduates are without work) and who will have to pay more to fund their own unlikely retirement all while struggling to help their ailing parents who didn't put enough away to protect themselves in old age. I could actually see taking that estimated $1,000 per worker in reduced payroll taxes and investing that in a locked down retirement fund that can't be accessed until the owner is over age eighty, but beyond that, I'm having trouble seeing the logic in this legislation.
Reader comments
I voted for change in 2008 but it's just more of the same. Government serving Wall Street, not Main Street. Instead of addressing our economic problems, Obama offers band-aids: extensions of unemployment benefits; payroll tax reduction.
We have 25 million Americans unemployed. Big corporations have been exporting jobs overseas where labor is $.50/hour. Do you remember the Sherman Anti-Trust Act? That died 30 years ago. Now Corporate America owns Washington, and all the politicians are the King's men.
Jefferson argued that democracy could only survive without a concentration of power in the hands of the few. And Adam Smith warned of the collusion between government and big business.
We now have a totalitarian state controlled by Corporate America. Of course, most Americans believe the propaganda that we have a free market. Like the crew of Odysseus, they have been lulled into a dream of the lotus-eaters by a Circean song of propaganda and myth.
We have 25 million Americans unemployed. Big corporations have been exporting jobs overseas where labor is $.50/hour. Do you remember the Sherman Anti-Trust Act? That died 30 years ago. Now Corporate America owns Washington, and all the politicians are the King's men.
Jefferson argued that democracy could only survive without a concentration of power in the hands of the few. And Adam Smith warned of the collusion between government and big business.
We now have a totalitarian state controlled by Corporate America. Of course, most Americans believe the propaganda that we have a free market. Like the crew of Odysseus, they have been lulled into a dream of the lotus-eaters by a Circean song of propaganda and myth.
Posted by William Brighenti from Berlin, Connecticut on Feb 27, 2012 - 8:21 pm
I again absolutely with your comments on the 2% reduction in SS payments -- a political ploy but again show the ignorance of the people we send to Washington. But I have a major cost program I would like to submit fire all Representative and Senators and we not longer need there staff with my program. Replace them all with $1000 computers and mark them R for republican and D for democrate. Than the R will vote all one way on a bill and the D willl vote all the same way on a bill just like we have now and we only have a one time expense and no retirement benefits. Only problem is we would be replacing existing with smarter representation
Posted by Ken from Bloomington, MN on Feb 24, 2012 - 0:30 am
What amazes me is the news keeps telling us that the average worker will save $1,000.00 based on the average salary of $50,000.00. Maybe average when the chief executives are figured in but "The average worker making $50,000.00?
Posted by Dave Mowery from undisclosed location on Feb 23, 2012 - 5:29 pm
As one reader pointed out the new law (not last years) is to be refunded from the general budget. A since we borrow anything we do not have to pay in cash, that means the debt by the General Fund to SSA will just go up. It is my understanding that this "internal" debt is not included in the Debt Ceiling. If that is true the General Fund has already borrowed heavily on the SSA and will just add to it. This of course does not in anyway change the "unfunded Social Security or Medicare" which is not in the "debt ceiling"
Posted by Gene from Seattle, WA on Feb 23, 2012 - 3:24 pm
Us Baby Boomers started working at or before 16 and most still working- we earned it - leave us along.
Posted by Jodi from Atlanta on Feb 23, 2012 - 3:22 pm
If Social Security was only paid to citizens and those admitted legally into the united states of America then are government would be balanced. So I agree with this reduction completely. Now if Congress and the Administration would adhere to the administration of the law as written we would have a balanced budget. $2 Trillion per year go to non-citizens over seas.
Posted by Keith Ljunghammar from Seattle on Feb 23, 2012 - 3:07 pm
Apply SS tax to all income from all sources but lower the rate to 7%.
Pay benefits only to elderly who, through no fault of their own, cannot work.
The theory at inception was as above, namely a welfare program. Return it to a welfare program.
For most folks the 8.3% saved can go into a retirement fund.
Pay benefits only to elderly who, through no fault of their own, cannot work.
The theory at inception was as above, namely a welfare program. Return it to a welfare program.
For most folks the 8.3% saved can go into a retirement fund.
Posted by Greg from Oregon on Feb 23, 2012 - 2:57 pm
I've often been a proponent of raising the the social security wage base to from $110, 100 in 2012 to unlimited. Talk about a regressive tax! I'm just talking on individuals, we can keep the business side at 6.2%. We could make the program solvent so I may retire at, do I dare say, 66. I'm not looking to work till 80, I want to enjoy a little life before I fall apart.
Posted by Joann from Milltown on Feb 23, 2012 - 1:41 pm
You might want to read the next article on your own page. Money is going to be transferred from the general fund to Social Security to offset the loss.
Posted by Collin from MN on Feb 23, 2012 - 1:34 pm
I've mentioned the double whammy this tax cut is to Social Security and I don't think that one of my clients disagree.
Taxes are what you pay to live in a civilized socirty; perhaps these tax cuts and additional programs are the reason that we are less civil than years ago.
Taxes are what you pay to live in a civilized socirty; perhaps these tax cuts and additional programs are the reason that we are less civil than years ago.
Posted by Ray from Rochester NY on Feb 23, 2012 - 1:19 pm
Political? Maybe for both sides. Good for the economy, yes, will it hurt SS not likely. Go back to basic Economics, everything is cyclical. The college grads will get work, the seniors will retire (401K's, stock market improving) and the US economy will be strong again. It takes time to correct 8 to 10 years of greed driven abuse.
Posted by Alice from NJ on Feb 23, 2012 - 1:16 pm
Send your comments
- 1884 reads
