This Is A “Good Deal”?
According to one our resident TAH liberals (yes, I’m talking about you, insipid), Social Security is a “good deal”.
Well, I guess everybody is entitled to their own opinion. But if it’s such a good deal, someone needs to explain to me precisely why. Especially now that workers retiring today and earning average lifetime income levels– both single retirees and dual-wage earner couples – are now projected to get less in benefits than they’ve paid in Social Security taxes during their working lifetimes.
Category: Politics
Geez, insipid – do you just ignorantly parrot crap you hear without bothering to do any fact-checking whatsoever? Today is hardly the period in time where Federal taxes have been the “lowest”. The top rate today is 35%. Here’s some historical top Federal income tax rates: 1913-1915: 7% 1916: 15% 1925-1931: 25% 1988-1990: 33% (“bubble rate”, not applied to income beyond a certain level; the max on high-earners was 31% above the cutoff) 1991-1992: 31% All of those maximum rates seem to me to be lower than today’s maximum Federal income tax rate of 35%. In addition, for many years with higher rates the impact was not felt until much higher real (inflation-adjusted) earnings levels than today. Today’s top bracket kicks in at $379,150 for married filing jointly and half that for singles. Here are some representative inflation-adjusted rates from past eras where higher tax rates were in effect: 1919: taxpayers would earn the equivalent of $726,316 in family income today before paying 35% in Federal income taxes. 1924: taxpayers would earn the equivalent of $1,049,729 in family income today before paying 35% in Federal income taxes. 1933: taxpayers would earn the equivalent of $1,001,078 in family income today before paying 35% in Federal income taxes. 1938: taxpayers would earn the equivalent of $795,672 in family income today before paying 35% in Federal income taxes. Oh, and those apply to singles, too – since it wasn’t until the 1950s that married couples and heads of households started getting tax breaks vis-a-vis single taxpayers. It wasn’t until just before and during World War II that US income taxation turned positively Draconian. And unfortunately, it pretty much stayed that way until Reagan and Bush (41) brought a well-needed dose of common sense to Federal income taxes. Further: before 1977, everybody who earned income generally owed Federal income taxes. The exemption of some income from Federal taxation (the low-end “0% bracket”) didn’t begin until that year. And except for 1991-1992, all of the above years also had lower Social Security taxes than today (12.4% combined employer/employee contribution, plus another 2.9% for Medicare). “We… Read more »
@Hondo, I miscalculated the percentages, using the self-employed rates, not the 50/50 rate on social security, which is 6.2% for payroll deductions. I dug out my 2002 tax return: 2002 FICA wages $39,700.76 (includes deferred comp deduction) SS&Medicare $40,949.77 fica $4,901.80 12.35% SS $2,538.89 6.20%** medicare $593.77 1.45%** state $1,191.02 3.00% $9,225.48 23.24% **If I had been self-employed in 2002, SS and Medicare taxes would be doubled. 2006: W-2 $40,146.00 (no deferred comp deduction) FICA $6,184.25 15.40% SS $2,489.50 6.20% medicare $582.12 1.45% This is for earned (FICA) income only, not including interest or dividends, which is unearned income and has a different tax rate. Add 3% for state income tax, total tax is 26.06% on earned income. Self-employed tax rates are still the full amount, which is 2.9% for Medicare and 12.4% for social security, plus FICA plus state income ta, which is a total tax burden of 33.7% on one person for earned income below the $50,000 level. It’s considerably higher on incomes above that level. Tax rates on earned income have increased more since I retired. So no nitwit needs to spout twaddle that we have the lowest tax rates ever. We don’t. In order to get this country out of its current debt, each citizen would have to pony up $50,000. We are NOT being offered interest-free loans from anyone, anywhere. The Chinese government bought US Treasury bonds in 2009 to fund the bailout. Those are not loans. They carry an interest rate, which the bond seller (the US government) is obligated to pay. China is the biggest purchaser of US treasuries, well ahead of oil exporters and other entities. Should the US government default on these bonds, the impact will be felt everywhere. In January 2012, Standard & Poor downgraded the creditworthiness of nine European nations: Cyprus, Italy, Portugal, and Spain by two notches, and one notch for Austria, France, Malta, Slovakia, and Slovenia. The US is now being watched for further downgrades if the debt situation worsens. On February 14, 2012, Moody’s rating service downgraded six of these nations and warned that it may… Read more »
“There is no tax problem. There is a revenue problem.” Insipid.
This is about as idiotic statement as one can make. “Government revenue” is simply taxes, when the politician doesn’t want to admit he is asking for higher taxes.
Further Insipid attempts to claim that Obama has miracously become a Fiscal Conservative and no longer spending money like a College Student with daddy’s platinum card. (A drunken sailor stops spending when he runs out of money or passes out.)
The Obama Administration has tripled the record deficit of W’s last year. He has maintained it at $1.3 Trillion, managing to add 50% to the National Debt, compared to when he took over. In short it took 235 years to amount $10 Billion in National Debt. Obama managed to add $5 Billion in less than 4 years.
How did he do that, without passing a single budget? Well Reid & Pelosi couldn’t be bothered with a budget and he has relied on continuing emergency stop gap measures to prevent having to compromise with Boehner. He has ruled by fiat, extortion, and threat. The only thing the Boehner House has managed to do is stop even greater spending by Obama. And the only thing that will stop that logjam is either replacing Obama & Reid, or Boehner taking it to brinksmanship of being prepared to let the govt cease operations until Obama and Reid are willing to ACTUALLY compromise.
Small correction, WOTN: you’re low regarding the amount of Federal debt added by the Obama Administration by a factor of x1000. The Obama Administration has added $5 Trillion – that’s $5000 billion – in new Federal debt since they took office in Jan 2009.
Our Federal debt is now fast approaching GDP levels. That – and not “political brinksmanship” – is the main reason why Moody’s et al have downgraded the Federal government’s credit rating.
Here’s a little update on those bailouts back in 2009, from this morning’s news (8/14/2012)
STOCK FLOP: taxpayers will lose $3.3 billion more on the auto industry bailout than the government predicted two months ago, hurt by General Motors’ falling stock price.
BALLOONING BAILOUT: The Treasury Department expects to lose $25.05 billion on the bailout, up from a previous estimated loss of $21.7 billion. GM’s stock price fell 15 percent during that period.
LONG AND WINDING ROAD: The government spent about $80 billion to bail out GM, Chrysler and Ally Financial, the former finance arm of GM. So far it’s gotten back just over $37 billion.
Too big to fail? 😛
[…] August 19th, 2012 As I’ve previously noted, most folks approaching retirement age probably know they’re gonna get screwed by Social Security – e.g., that they’re gonna get less back than they paid in in benefits. But that’s only […]
@50- 68W58 – I didn’t address the point because it’s a stupid point. The 19% number does nothing to address WHERE the money comes from. It doesn’t say which percentage is paid by poor, by middle class, by wealthy etc.
@54- Hondo. The so called “trippling” of the debt was caused almost entirely by thee things
1. Honest book keeping. He put the wars and Medicare part D. on Budget and stopped paying for them in “emergency” supplementals and
2. less money coming in due to the Republican-caused great recession.
3. More money going out due to the Republican-caused great recession.
Here:
http://i894.photobucket.com/albums/ac143/ThisIsMyTime_2010/BushDeficitsVsObama.jpg
The biggest cause of debt is the Bush tax cuts, the second biggest is the economic down-turn the third biggest is the unpaid for wars. Of only major contribution Obama made to the debt is the recovery act which only accounts for 5.2% of the the debt and also saved us from a second great depression.