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View Diary: Bernie Sanders goes against grain, introduces real plan to save Social Security (166 comments)

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  •  Absolutely Sherri (4+ / 0-)

    We need a lot more progressivity in the tax system, hell if I had my way we would be back to Kennedy era top rates starting yesterday.

    But Social Security is the LAST place you want to do that. Look at the history of top rates. At the time of the passage of the Social Security Act of 1935 the top rate was 63%. By the time the first monthly benefits were paid out in 1941 under Title 2 of that Act (what we know as Soc Sec today) that rate was at 81%, and this by the way BEFORE the war year increases that took it to 94%.

    Yet FDR and his Brain Trust decided to not devote a single penny of those extra income tax dollars to Social Security. Clearly FDR wasn't against progressive taxation, he ended up boosting top rates by 29 points, but he deliberately decided NOT to make Social Security reliant on income tax.

    I always ask people who think that just taxing the wealthy to top off Social Security is just so "obvious" why they think they are smarter than FDR and Frances Perkins.

    Please visit, follow or join our Group: Social Security Defenders

    by Bruce Webb on Thu Aug 25, 2011 at 02:23:56 PM PDT

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    •  Re:Another Option (0+ / 0-)

      I understand that FDR wanted everyone to pay in and not let it be a welfare program, but wouldn't that make more sense if minimum wage jobs actually paid a living wage?  I just read Nickel and Dimed and we have a huge class of working poor people in this country and it continues to grow.  If minimum wage is not even a living wage anymore, what are our choices?  Payroll taxes take a chunk out of poor people's paychecks.  Why do we feel it necessary to tax people who are already so incredibly poor to begin with.  There is also a huge push to extend the payroll tax holiday anyway.  I guess I am just trying to think outside the box.

      •  Umm? Raise minimum wage?? (4+ / 0-)

        It perplexes me that progressives just seem to accept that they are totally screwed when it comes to directly addressing income inequality yet think they can just stick a 12.4% FICA surcharge on upper income folk.

        Who bells THAT cat? I mean these people are fighting tooth and nail to keep their rates from going up 5% points, yet somehow they are just going to accept increases more than double that?

        If we can push cap increases through we can push minimum wage and collective bargaining improvements through. And if we can't do the latter our political chances of doing the former are zilch. It seems to me that people have simply fallen into the Klein-Yglesias Neo-Lib mindset that insists everything has to be done via 'redistribution' while not seriously examining and challenging the initial distribution. That is even progressives too often accept the logic of the Invisible Hand when really we are just seeing the end result of power politics and capitalist controls of the compensation spigot in the absence of effective regulation.

        It doesn't have to be this way. Which is why Wall Street is crapping in their pants at the prospect of a Senator Warren joining Sanders come 2013.

        Please visit, follow or join our Group: Social Security Defenders

        by Bruce Webb on Thu Aug 25, 2011 at 02:51:16 PM PDT

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        •  Easy to push min wage increase (0+ / 0-)

          Hard to make that increase represent real purchasing power gains. A lot of the increase is eaten up in unemployment.

          (-5.50,-6.67): Left Libertarian
          Leadership doesn't mean taking a straw poll and then just throwing up your hands. -Jyrinx

          by Sparhawk on Thu Aug 25, 2011 at 03:41:25 PM PDT

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          •  Bullshit. That textbook theory has been tested (2+ / 0-)
            Recommended by:
            Roger Fox, wsexson

            and failed. It relies on the same crappy Freshwater marginal rate fetish that underlies all parts of their theory.

            There is little real world evidence that changes at the margins automatically have the employment effects predicted by the model. The idea that every employee everywhere is individually or as a member of a specific firm's workforce are splitting total compensation strictly established by their collective marginal productivity is just a fantasy that can only be maintained if you don't review the history of labor relations in this country or abroad over the last 150 to 300 years.

            Which is why most Freshwater Economics Departments don't require their students to study Economic or Labor History to start with.

            You might want to Google Card and Krueger 'Minimum Wage'. Others might want to examine the summary available here:

            The whole argument that minimum wage increases simply offset by increased unemployment has historically just been an instrument for the justification of wage suppression. In most sectors of the economy that are typified by minimum wage work the cost of labor is driven by demand for whatever the product is at whatever price point that product will bear in that particular market. Which among other things explains why you have the same Dollar Menu at almost every MacDonalds' or Wendy's across the country even where the local costs for labor and rent are much cheaper than they would be elsewhere.

            Employers will pay wages at whatever rate that the market will clear, or alternately at the lowest rate allowed by law if that is higher. That is the laws of supply and demand work at a more fundamental level than esoteric theories based on marginal productivity.

            Please visit, follow or join our Group: Social Security Defenders

            by Bruce Webb on Thu Aug 25, 2011 at 04:18:20 PM PDT

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            •  Re (0+ / 0-)

              Thanks. I actually meant to say inflation rather than unemployment (typing this on a phone in the middle of a 50 hours in 4 days kind of week).

              This isn't necessarily an argument against raising the wage, just that it won't help as much as proponents say it will.

              (-5.50,-6.67): Left Libertarian
              Leadership doesn't mean taking a straw poll and then just throwing up your hands. -Jyrinx

              by Sparhawk on Thu Aug 25, 2011 at 06:03:42 PM PDT

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    •  Its not a single faceted issue (0+ / 0-)

      You're exactly right Bruce. I'm not claiming FDR played 11th dimensional chess, but I'm sure that FDR was a fine chess player, and in todays times many people are not aware of the balancing act that FDR accomplished in tying so many issues together before he acted.

      FDR 9-23-33, "If we cannot do this one way, we will do it another way. But do it we will.

      by Roger Fox on Thu Aug 25, 2011 at 06:45:46 PM PDT

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