Why do we have Social Security at all? To put it simply, because we must. When people reach the age at which they can no longer work, we must have a mechanism in place by which they can obtain the necessities of life; the alternative — just letting them starve — is unthinkable. SocSec benefits ensure that people who work all their lives get a decent standard of living during their retirement.
We all have a compelling interest in this. Were it not for the blue collar worker, nobody in the country would possess anything at all. The labor of the working class enables all of us to share our nation's bounty. We — rich and poor alike — have an obligation toward the retired worker. That burden should fall on all citizens. The current system places the entire burden on the worker to provide for his or her retirement, letting the 1% ignore that obligation entirely. This is just flat wrong.
We tax the 99% heavily (especially at the state and local levels), while allowing the rich to seize virtually all of the productivity gains, gains which can be attributed principally to the efforts of the 99%. This means that the 99%, with a dwindling share of the pie, not only must do all the heavy lifting, but they must also support the SocSec Trust Fund, and also must feed the greed of the 1%. That's a heavy load.
Conservatives tell us that we must raise the retirement age because people are living longer. They insist upon a benefit cut, pure and simple. The workers get less, so that the 1% can get more. It works like this: With a larger work force competing for the same number of jobs, downward pressure is exerted on wages. Lower wages means more for the 1%, and with less in wages, the 99% contributes less to the Trust Fund. The net result is less for the worker, both during his working life and in retirement. Would you care to guess where those dollars go?
Statistically, the worker at the lower end of the economic spectrum has a lower life expectancy than his wealthier fellow citizens. This means that worker pays the highest price, in terms of lower benefits, for extending the retirement age. It would seem that the rules of the game always favor the 1%.
What a surprise.
Class warfare is spiraling out of control, and the working class is losing that war. A mere 400 people, hardly enough to populate a decent size subdivision, control a staggering $2.3 Trillion. Over the past year, the Forbes 400 have extracted an additional $300B from the 99% over the past year. It is simply impossible for the average reader to comprehend how immense these amounts are. There is no conceivable national purpose to be served by having 400 people control $2.3 Trillion, nor having their wealth to increase without bound each year.
As a modest first step, I propose that we impose an 8.0% tax on all income of any kind in place of the current 12.4% SocSec tax plus the 2.9% Medicare tax. This number is arrived at in the following manner: Total payroll tax receipts of $947B for 2013 are found here. Total USA personal income numbers of $13.4T are found here. Dividing $13.4T by $.974T gives us a rough rate of 7.27%. I have chosen 8% because I think the retired deserve a bigger slice of the pie than they now get. A more refined calculation than mine might come up with a different number, but almost certainly that number would fall between 6.5% and 8.5%. This would make the SocSec tax a flat tax instead of a regressive one. (I would rather see a progressive SocSec tax, but we must start somewhere.) As with the current payroll tax, there would be no exemptions, deductions, credits, or tax breaks of any kind. If my algebra is correct, the end result would be a tax increase for those making more than $284,000 and a tax decrease for the rest of us. In very rough terms, the 1% would pay more and the 99% would pay less.
I understand that there are those who would oppose this proposal vehemently, but I cannot for the life of me understand why. Please join me below the fold.