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View Diary: Scarborough is complaining that "taxing the rich" won't "fix" Social Security (26 comments)

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  •  No, that is not how it works (in theory) (0+ / 0-)

    a lot of people made that argument in the past, but Obama's payroll tax cut/holiday put the lie to that misinformation:

    Wouldn’t expanding the payroll tax holiday just make this problem worse?

    No. Under the current payroll tax cut that expires at the end of this year, employees are only paying 4.2 percent – instead of the standard 6.2 percent – of their wages into the Trust Fund. The original legislation for this policy (as well as the BPC proposal for a full holiday), however, ensures that the Trust Fund is not shortchanged. The General Fund of the government will transfer the foregone revenue dollar for dollar back to the Trust Fund, such that it is made whole in real time with no impact on Social Security’s financing. This is one apprehension that can be put to rest.


    IOW, the $$s seemlessly sloss back and forth between the general fund and the SS "lockbox"

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