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View Diary: Why Now is the Time to End the Social Security Tax Loophole (87 comments)

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  •  You must have skipped... (4+ / 0-)

    this part of the diary:

    First, recognizing that wealthy Americans would be paying in more, they would receive more benefits in return.
    •  It's not a "tax loophole." Even discussing it (14+ / 0-)

      in those terms undermines it.

      I have no problem with raising insured wages back to 90% of all wages.  That probably is enough.  But this

      Ending the Social Security tax loophole would eliminate this discrepancy and require that all income is taxed under FICA, significantly strengthening Social Security.
      Would either mean you pay hundreds of thousands of dollars a year, or even millions a year (to the Warren Buffets of the world) in retirement benefits to very very rich people -- including paying retirement benefits on investment income -- or it would mean severing that link between insured wages and retirement benefits.  Either one is unacceptable in my view.  

      Raise the cap back to 90% of all earned wages.

      •  14k annually (1+ / 0-)
        Recommended by:
        Clem Yeobright

        $168,000 annually by my back of the envelope calcs.

        And those richer people live longer, 5 to 10 years longer. SO that 168k can become 340k, from 65 to 91 yrs old.

        ...... Social Security blogathon March 25th thru March 29th. #HandsOffmySS 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 Tue Mar 26, 2013 at 01:53:40 PM PDT

        [ Parent ]

        •  C'mon, Roger, kick it up a notch! (3+ / 0-)
          Recommended by:
          VClib, 3goldens, Roger Fox

          Funny thing about SS is that very different amounts of benefits may proceed from a single 'account' - because SS unlike other pensions focuses on the welfare of the recipient(s) and not strictly on the value of the contributions.

          So the cap is scrapped and you and I both walk into the SS Office with our identical $28-million-in-35-years earnings records and I - a lonely (and cranky) guy - get roughly my 15% income replacement of $10k per month and you get:

          $10k for you, and
          $5k for your wife, and
          oh yeah, $5k more for that woman who divorced you 20 years ago.

          And that's every month for the rest of your lives, and even if you (like me) gently fade away at 85 or 90, it's likely that lady of yours will collect that $10k - COLA'd however it's COLA'd - for a solid 400 months = ... 4 million smackers! In 2012 dollars!

          Now, if the cap stays in place and the same scenario occurs with your payment of $2500 and your wife's and ex-wife's $1250 each ... I can feel okay with it, things worked out for you, congratulations! But 4 million! Fuck Social Security! LOL

          Moral: Keep the cap!

          Too late for the simple life, too early for android love slaves - Savio

          by Clem Yeobright on Tue Mar 26, 2013 at 02:31:35 PM PDT

          [ Parent ]

      •  The position that increasing the cap (0+ / 0-)

        would require increasing the benefit for top earners ignores the fact that the top earners have kept almost all productivity gains for themselves and now distort the argument that they should have a cap otherwise SS would become a welfare system.  In that context all work is welfare for the laborer.
        Why doesn't anyone want to include the stolen productivity workers have contributed to over the past thirty years that they have not benefited from at all?

        "I freed a thousand slaves, I could have freed a thousand more if only they knew they were slaves" Harriet Tubman

        by BrianParker14 on Thu Mar 28, 2013 at 08:50:45 PM PDT

        [ Parent ]

    •  Here's a question to ponder (13+ / 0-)
      The first time you hear someone say
      My brother-in-law is retiring and he and his wife will get $15,000 a month in Social Security. They're spending some of it on a world cruise and they'll be banking the rest.
      what will be your attitude towards Social Security?
      Nothing will destroy SS and its reputation and its public support more effectively than allowing people to insure high salaries through it.

      That's not what Social Security is about.

      Please leave my Social Security alone.

      Too late for the simple life, too early for android love slaves - Savio

      by Clem Yeobright on Tue Mar 26, 2013 at 01:25:18 PM PDT

      [ Parent ]

      •  The effect of Social Security payments being (2+ / 0-)
        Recommended by:
        SilentBrook, Pluto

        left in the bank depends on what the bank does with the currency. If it makes loans to local enterprise, that's a good use. If it finances over-priced real estate that is likely to be defaulted, it's a bad idea.
        All dollars are nothing but certified IOUs. Classifying them according to who's holding them or using them is a mistake. All our dollars are belong to us, the citizens of the U.S.

        We organize governments to deliver services and prevent abuse.

        by hannah on Tue Mar 26, 2013 at 02:32:32 PM PDT

        [ Parent ]

    •  About $168,000 a year according to the AIME (2+ / 0-)
      Recommended by:
      Clem Yeobright, VClib

      formula

      ...... Social Security blogathon March 25th thru March 29th. #HandsOffmySS 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 Tue Mar 26, 2013 at 02:06:06 PM PDT

      [ Parent ]

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