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Mistake About Social Security Distorts Sunday New York Times Budget Exercise

The facts: In 2015, the Social Security trustees' latest report projects program outlays will exceed Social Security payroll tax revenues slightly. But Social Security has two other dedicated income streams. In 2015 one source -- taxes on the benefits received by high earners -- just about cancels that difference. The third stream -- interest on money borrowed by the Treasury from the Social Security Trust fund -- would add $154 billion in revenues. So, official projections for 2015 show Social Security generating a surplus of $151 billion.

Social Security Static

(Note:  the above charts do not include our debt interest payments which, if we do not pay down our debt, are simply unsustainable over time.  It's worth noting.)

For Facts/Truth about the 4.6% tax increase for the 1% that earn $250,000 or more, read

Tax Cuts:  Brilliant Analysis! End Tax Holiday for Rich!

Example of Info:

The Tax Rate History is our friend.

In 2009, only 1,198,412 Americans earned more than $250K !!

In 1982, their TAX HOLIDAY BEGAN. The tax rate dropped 20%!  From

90%  The tax rate, 1944 - 1964, to
70% where it remained until it dropped to
50% in 1982.  Not good enough!  It dropped AGAIN to
38.5% in 1987.  Still not good enough.  It dropped AGAIN to
28% in 1988!  Bush I, increased it to
31% in 1991, Clinton increased it to
39.6% in 1993, and Bush II dropped it AGAIN to
38.6% in 2002.  Still not good enough.  Bush II dropped it AGAIN to
35% in 2003.

There were No Tax Holidays for the majority of us, however.  
Since 1941, most income earners have paid between 20% - 28% income tax consistently!

Why aren't the Democrats framing the issue and asking:

"How will Increasing the tax rate by a mere 4.6%, for only 1,198,412 people, create jobs?  

Why continue the 30 Year TAX HOLIDAY that only those earning over $250K have enjoyed?

To learn how a truly Progressive Tax was ended by Reagan and has not been reinstated since, read:

History of Tax Rates from 1913 - 2010:  Fair Tax?

SOCIAL SECURITY IS SOLVENT.  It is not a Deficit Issue.  Unless, somehow, the GOP figures out a way to sleaze out of paying back all the money BUSH Co and the GOP BORROWED from the Social Security Trust  No tax revenues are used to pay for Social Security or Medicare.  They are solvent, and paid for with FICA, not tax revenues.

Knowing this, it becomes easy to determine who is lying about Social Security.  They are not Entitlements, although that word is used.  They are insurance programs.  We pay the premiums out of every paycheck, again every paycheck by every worker, from the very poorest up to, (WHAT?  only on income up to $106,000?) for our entire work history.  Why the cap AND historically low taxes on the miniscule 1% wage earner?

Congress lies.  Media lies.  The Cat F'd Commission blatantly lies.

Tweet, twitter, facebook, email and spread the truth

Proof that SS and Medicare ISN'T the deficit problem, tax cuts are.

The extended-baseline scenario (also known as "current law" projections) assumes that  the 2001 and 2003 tax cuts will expire at the end of this year as scheduled;

The alternative scenario includes extension of 2001 and 2003 tax cuts (except for the top two income tax brackets*);

*If tax cuts for the highest earners do not expire, the alternative scenario will be even worse!

The US cannot afford to extend all the tax cuts.  

Social Security Static

The real issue is who should pay:

The 71% that are barely getting by, the elderly, or the higher earners who can afford to.

Here's a chart that demonstrates the impact on the deficit with and without the tax cuts.  

The Congressional Budget Office blatantly blames the Bush II tax cuts for the deficit:

Deficits Affect of Tax Cuts

Furthermore, when the cost of all legislation enacted since 2001 is considered,

the tax cuts are found to cost more than all program increases combined, including increases in military expenditures, homeland security, and education spending.

THIS IS THE REALITY.  The CBO research didn't find that Social Security and/or Medicare are the deficit problems.  

So why is Congress, the media, and the Cat F'd Commission attacking Social Security and Medicare?   Because they can IF we do not really, really fight back NOW.

At a glance, it's easy to see that Social Security and Medicare, both paid by FICA NOT tax revenues are NOT the problem.  The Unending Wars impact the deficit, but the tax cuts ARE THE CULPRIT:

Deficit Caused Mostly by Bush

For some reason, The Cat F'd Commission and media are not talking enough about reality.

Instead, both are broadcasting the same Peter G Peterson - Milt Friedman neoconservative - privatize everything - destroy FDR's social safety net - billionaires decades old attempts to strip Social Security and Medicare:

They insist that Entitlements are the problem.

The facts clearly demonstrate that Entitlements are are not the problem.

We need to keep broadcasting these facts.  Will we?  Will you help?

 

Tax Cuts and Deficits are like Siamese Twins:

They are and always have been inseparable.  It's not rocket science.  

We all know that if our income decreases and our expenses don't, that we are at risk of not having enough money to cover our expenses.  It's that simple.

For some reason, since 1980, the Republicans don't care about this reality.  And now they are screaming about deficits.  Have they really forgotten that they have caused the deficits?  Really?

We simply can't afford to continue the tax cuts.  It's simply a harsh reality.  It was irresponsible for Reagan and especially Bush II's Rubber Stamp Congress to have cut taxes:  The Revenue the US needs to pay it's bills.

These charts proves the point.  Reagan cut taxes, the deficit increased.  Bush I and Clinton increased taxes, the deficit decreased.  Bush II cut taxes, the deficit increased (Bush II also launched two unfunded wars and a $500 billion Medicare program)

Nat'l Deficit Graph

Deficits are the Disease, not the Cure.  Odd title for the above graph, btw.  We have no choice.  Tax revenues must increase if deficit reduction is truly that high a priority.

WHO  SHOULD PAY THE TAX REVENUES REQUIRED TO REDUCE THE DEFICIT?

71% of Americans who earn less than $45,000/year?

50% of families who earn less than $50,000/year, thus barely getting by?  

The elderly by reducing their Social Security and Medicare benefits?  

The unmarried who pay a disproportionatly higher tax rate, half of whom earn less than $30,000/year?  

The higher earners?  

Or the uber earners?

PROBABLY ALL OF THE ABOVE;

HOWEVER, TAX RATES MUST NOT FURTHER IMPOVERISH THE MAJORITY OF AMERICANS THAT BARELY MAKE A LIVING WAGE.

Cuts or Not:  Congress needs to pass an "IRS Fair Tax Adjustment Law" to ensure that hard working Americans, who haven't seen an increase in wages for 30 years are protected, not punished by the present disproportionate tax rates.

This chart is proof of flat wages for decades.Median income is a more real wage estimate; however, even median income projects a higher income than the reality on the street for millions of Americans, because higher wages are included in the estimate with only the outliers removed.  Don't let the media or anyone get away with reference to Average Income, it's not close to reality for most Americans, sadly:

Tax Average Median Wage

Here is a clear picture of just how many Americans are earning barely enough to survive:

Taxes Median Income

The percentage of wages taxes must be changed with our without the tax cuts continuing or sunsetting.  This is the conversation we need to have.  

Please review the two tax tables.

Here are the two tax tables.

Note how unfair the rates are for all who are not married.  This is another issue, but one we can demand be addressed:  Why are tax rates punitive for young, old, divorced, separated, and/or gay citizens?  Compare the rates to see for yourselves.

The first is for 2010, which include the Bush/GOP tax cuts for all.  The second is the tax table for 2000 which, if they are allowed to expire and remain unchanged, will be the tax table for 2011:  

Taxes-  2010 Tax Rates

Tax Rates:  2000 Pre-Cut Rates

Why are the earners barely getting by asked to pay 25%/28% plus 7.5% FICA, while the uber wealthy only have to pay 35%-39.6%?

That is disproportionate and it has been since 1949, especially for unmarrieds.

From 1912-1949, everyone paid the same tax rates on income.  In 1950 that changed.

You can review the entire history, from 1913 - 2010,  tax rate tables here.

And to be fair in the analysis, there are other considerations as well:  

There are some other sunset considerations.  It will be political suicide for either the DEM or the GOP to allow the following to sunset.  Especially because so many have lost their jobs/health insurance and forced to work for even lower wages and even part-time.

Marriage-Penalty Relief & Child Tax Credit

Both sunset in 2010.

More relief for married parents -- and single parents as well -- can be found in the acceleration of the child tax credit to $1,000 from $600 for tax years 2003 and 2004. After 2004, the rules revert to levels enacted in prior legislation: a $700 tax credit for calendar years 2005 to 2008; an $800 credit in 2009; a $1,000 credit in 2010, after which the credit disappears.

Because the cost of these breaks to the government coffers is nominal compared with the rest of the package, CCH's Mr. Luscombe believes it's likely the provisions will be re-enacted for years 2005 and forward.

It's been a long time since I had to play with Child Tax Credits.  But here is the pertinent portion of the table:  It is too large to display the entire 2000-2012 table here.

Taxes-  Child Tax Credits

Here are the IRS deduction rules for 2010:

You will find that uberly higher income earners have traditionally paid between 50% and 70% income tax rates.  It's sounds harsh, but they are still left with a huge income and remain happily wealthy.  Today, 1% earn more than the 99%.  That's a bit out of balance:

Top 1% Income Gains Highest Since 1920s

And, oddly, tax rates for the uberly wealthy in 1929 and now were the two lowest rates for the entire history of tax rates:  25% in 1929 and 35% now.

To prove that the majority of American earn under $45,000 you can go here for the tables.  It's really quite jaw dropping:

Wage Statistics for 2009, November 15, 2010

_____________________________________________

TWO PETITIONS IF YOU HAVE A MOMENT:

PLEASE SIGN THE PETITION TO EXTEND UNEMPLOYMENT

President Obama: FIGHT Bush tax cuts for millionaires!

Thank you.

Originally posted to War on Error on Sat Nov 20, 2010 at 09:00 AM PST.

Poll

Do you believe Social Security is a Deficit Problem

7%2 votes
92%25 votes

| 27 votes | Vote | Results

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Comment Preferences

  •  Tip Jar (16+ / 0-)

    10.2.10 March On Washington ROCKED http://www.onenationworkingtogether.org/pages/march-details

    by War on Error on Sat Nov 20, 2010 at 09:00:29 AM PST

    •  As a fellow charts and statistics geek, let me... (6+ / 0-)

      be the first to say THANK YOU for this informative diary!

      Tipped and rec'd happily :)

      "Taxes are the price we pay for a civilized society" -Oliver Wendell Holmes

      by APA Guy on Sat Nov 20, 2010 at 09:05:55 AM PST

      [ Parent ]

      •  You are welcome, APA Guy (3+ / 0-)
        Recommended by:
        Major Tom, JeffW, papicek

        There are so many out there that dispel the "Social Security is a Deficit problem", it's difficult to choose.

        All, please feel welcome to add any others.

        Perhaps a compilation of credible facts/proof/CHARTS can offset the Kill Entitlements Campaign of the billionaires, like Peter G Peterson, Et Al.

        10.2.10 March On Washington ROCKED http://www.onenationworkingtogether.org/pages/march-details

        by War on Error on Sat Nov 20, 2010 at 09:14:10 AM PST

        [ Parent ]

      •  It's the Classic Bait and Switch (3+ / 0-)

        A very little tweaking here and there would make Social Security solvent forever. So, therefore, it simply represents the typical, Republican strawman target.  

        Yet is it really about getting rid of the deficit though? Well, the plan of the Deficit Commission is incredibly weak in terms of actually reducing the debt. They want to achieve $4 trillion in deficit reduction over 10 years; that’s just $400 billion a year, and most of the savings are in the out years. Heck, we could actually save a good portion of that number in ten years if we just do not extend the tax cuts for millionaires and billionaires. Furthermore, if we just allowed the tax cuts for everyone to expire, there's your entire $4 trillion in savings over ten years.  

        Also, the plan is to reach a balanced budget by 2037. Folks, 2037 is 27 years down the road; so why is it taking so long to reach a balanced budget? Remember, they’re not talking about paying down the National Debt at all.

        The answer is that this Deficit Plan is really a disguised Tax Cut Plan tailor-made for the uber-rich, who will pay a top rate of 25% under their plan. You know, in less than eight years Bill Clinton not only balanced the budget, but he also began to markedly pay down the Public Debt.  

        Does anyone want to buy a bridge?

        •  And the majority paid a really high tax rate. (1+ / 0-)
          Recommended by:
          Major Tom

          Obvious to most, if revenues equal spending:

          NO DEFICIT

          Somehow, the GOP brains have some disrupted synapses.

          10.2.10 March On Washington ROCKED http://www.onenationworkingtogether.org/pages/march-details

          by War on Error on Sat Nov 20, 2010 at 09:40:40 AM PST

          [ Parent ]

    •  Uber-Wealthy pay 16% on their huge incomes (1+ / 0-)
      Recommended by:
      War on Error

      due to preferential tax rates on the kinds of income the uber-wealthy tend to have Dividends and Capital Gains.

      The top 400 households paid 16.6 percent of their Tax Rates Dropping Sharply for Highest Earners income in federal individual income taxes in 2007, down from 30 percent in 1995. This decline works out to a tax cut of $46 million per filer in 2007, or a total of $18 billion in tax cuts for these households per year.

      To make it into the top 400, a household needed an adjusted gross income of at least $35 million in 1992 (in 2007 dollars) and $139 million in 2007.  
      thanks largely to preferential tax rates on Dividends and Capital Gains.

      The decline in effective tax rates at the very top is due in large part to the capital gains tax cuts enacted n 1997 and 2003.  The top marginal tax rate on capital gains is now 15 percent, less than half the
      top tax rate on wages and salaries.  The top 400 taxpayers derived two-thirds of their income from
      capital gains and qualified dividends in 2007.

      Over roughly the same period, the top 400 filers enjoyed huge gains ipre-tax incomes.  The average pre-tax income of this group rose by over 400 percent between 1992 and 2007, equivalent to a $275 million increase per person, after adjusting for inflation.  In 2007 alone, average pre-tax incomes rose by 31 percent among these individuals.

      In short, the top 400 filers now pay much lower effective tax rates on vastly larger incomes
      pdf

      Demand Filibuster Reform call your Senators at (202) 224-3121 -AND KEEP CALLING

      by Lefty Coaster on Sat Nov 20, 2010 at 10:35:10 AM PST

      [ Parent ]

      •  Uber wealthy presently pay 35% on wages (0+ / 0-)

        FACT: Only 1% of wage earners earn a wage of $250,000 or more.  99% earn less than $250,000!

        f tax cuts end, that would jump a measely 4.6% to 39.6%, not exactly earth shattering.

        So why all the hoopla over a 4.6% increase for uber wealthy.

        Because today $250,000K isn't all that uber wealthy, sadly, when factoring in the cost of housing, education, etc.

        Which, when you consider that 71% of Americans earn less than $42,000/year, explains our high rates of poverty and personal debt.  See chart above and the report it was derived from for proof.

        So, why not a progressive tax increase for those earning over $250K.  For instance, just as an example:

        25% for $250,000 - $300K
        30% for over $300,000
        35% for over $300K
        40% for over $500K
        45% for over $1,000,000
        50% for over $5,000,000
        60% for over $10,000,000
        70% for over %20,000,000

        This would return the tax rates for high earners to the rates before Reagan gave high wage earners his much beloved Tax Holiday!

        And there certainly needs to be more progressive tax rates for those earning less knowing that even the poorest worker pays 7.65% to FICA, the unavoidable insurance premiums for Social Security, Unemployment, and Medicare.  And thank goodness we have them, btw.

        10.2.10 March On Washington ROCKED http://www.onenationworkingtogether.org/pages/march-details

        by War on Error on Sat Nov 20, 2010 at 11:45:54 AM PST

        [ Parent ]

  •  Really good diary but for one part (4+ / 0-)

    WHO  SHOULD PAY THE TAX REVENUES REQUIRED TO REDUCE THE DEFICIT?

       71% of Americans who earn less than $45,000/year?

       50% of families who earn less than $50,000/year, thus barely getting by?  

       The elderly by reducing their Social Security and Medicare benefits?  

       The unmarried who pay a disproportionatly higher tax rate, half of whom earn less than $30,000/year?  

       The higher earners?  

       Or the uber earners?

    PROBABLY ALL OF THE ABOVE;

    The lower middle class is being crushed. The recovery has not started for them. They should not have their taxes raised.

    look for my DK Greenroots diary series Thursday evening. "It's the planet, stupid."

    by FishOutofWater on Sat Nov 20, 2010 at 09:15:07 AM PST

    •  The middle class may have to... (3+ / 0-)
      Recommended by:
      Major Tom, papicek, War on Error
      ...face a tax increase, since letting the whole tax cut package sunset seems to be the only way to prevent the upper 2% tax cuts from being extended.

      Float like a manhole cover, sting like a sash weight! Clean Coal Is A Clinker!

      by JeffW on Sat Nov 20, 2010 at 09:20:36 AM PST

      [ Parent ]

      •  It's only a 4.6% increase !!! What's with all the (3+ / 0-)
        Recommended by:
        Major Tom, JeffW, papicek

        hoopla.

        They will still pay half of what that level of income earner paid for most of the 20th Century, until Reagan gave them a 50% Tax Holiday, continued, btw, by

        Bush I
        Clinton
        Bush II

        You'd think they were being asked to pay a huge increase.

        And, btw, only 1% of earners in America earn $250,000 or more.

        I'm not sure why everyone is saying 2%.

        Proof found in the Wage Statistics link towards the end of the diary.

        10.2.10 March On Washington ROCKED http://www.onenationworkingtogether.org/pages/march-details

        by War on Error on Sat Nov 20, 2010 at 09:24:50 AM PST

        [ Parent ]

        •  Inflation calc. changes distort official numbers (4+ / 0-)
          Recommended by:
          Major Tom, JeffW, papicek, War on Error

          The way inflation is calculated was changed in the Reagan years to hide inflation, according to Shadow statatistics.

          Inflation was a lot higher than officially reported from the '80s until the tech bubble burst.

          Therefore, those income brackets make the lower middle class look better off than they actually are. The lower middle class cannot afford a tax increase... and it's terrible politics.

          look for my DK Greenroots diary series Thursday evening. "It's the planet, stupid."

          by FishOutofWater on Sat Nov 20, 2010 at 09:41:02 AM PST

          [ Parent ]

          •  Which is why this followed the quote: (4+ / 0-)
            Recommended by:
            Major Tom, FishOutofWater, JeffW, papicek

            HOWEVER, TAX RATES MUST NOT FURTHER IMPOVERISH THE MAJORITY OF AMERICANS THAT BARELY MAKE A LIVING WAGE.

            Cuts or Not:  Congress needs to pass an "IRS Fair Tax Adjustment Law" to ensure that hard working Americans, who haven't seen an increase in wages for 30 years are protected, not punished by the present disproportionate tax rates.

            And now food prices are rising, although not reported.

            The GDP is fudged up from the perspective of what it actually costs people for basic living costs.

            There are no protections from the Masters of the Universe using our food to create the next bubble:  Commodities.

            Really?  Should they be allowed to speculate with food?

            I think not.

            Yes, farmers need the Commodity Exchange to offset cash flow and hold a price position for their crops.

            But should hedge funds be allowed to Play With Our Food?

            Like they did with oil a while back?

            10.2.10 March On Washington ROCKED http://www.onenationworkingtogether.org/pages/march-details

            by War on Error on Sat Nov 20, 2010 at 09:51:46 AM PST

            [ Parent ]

          •  Right (3+ / 0-)
            Recommended by:
            FishOutofWater, JeffW, papicek

            That's called Inflation Caused Income Tax Bracket Creep.

        •  How does that compare to the invisible tax cut (3+ / 0-)
          Recommended by:
          Major Tom, JeffW, War on Error

          that polls say most people did not notice.

    •  Good point. Sadly (3+ / 0-)
      Recommended by:
      Major Tom, FishOutofWater, papicek

      The lower middle class, 71% of the working public, has been carrying a disproportionate tax liability since the 1980s.

      Sometimes I am guilty of provoking debate.

      For a history of The Death of Progressive Taxation (thanks to Reagan, BushI, Clinton, and BushII) you can read here:

      http://www.dailykos.com/...

      A truly progressive tax was in place most of the 20th Century, even though for many of those years the poor still pay too high a rate.

      It's worth a perusal in order to put our present day tax rates into perspective.

      10.2.10 March On Washington ROCKED http://www.onenationworkingtogether.org/pages/march-details

      by War on Error on Sat Nov 20, 2010 at 09:21:46 AM PST

      [ Parent ]

    •  Fish (3+ / 0-)
      Recommended by:
      FishOutofWater, papicek, War on Error

      The Deficit Commission calls what you have pointed out as a "broadening of the tax base." That bit of propaganda really sounds fair, doesn't it? Sure it does; that is, until you realize who is getting hit the most when the tax base is in fact broadened, as your commentary aptly points out.  

      •  Look at the base broadening in the 1986 tax (0+ / 0-)

        code.  The top marginal rate goes down from 50% to 38.5%, but the effective rate - what people actually pay - goes up from 23.8% to 25.8%.
        So base broadening can work if - and that may be a bit if - it's correctly designed.

        •  It worked well to transfer wealth upwards (1+ / 0-)
          Recommended by:
          Major Tom

          as intended.

          look for my DK Greenroots diary series Thursday evening. "It's the planet, stupid."

          by FishOutofWater on Sat Nov 20, 2010 at 09:42:16 AM PST

          [ Parent ]

          •  They still paid more after the decrease in tax. (0+ / 0-)

            They paid more in tax as a % of their income than they did when the marginal rate was 50%.

            •  Really? Just talking about the tax table history (1+ / 0-)
              Recommended by:
              papicek

              Other than the period 1925 - 1930, the higher incomes have been paying the lowest rate on W-2 earnings since Reagan dropped them hugely.  Even if the increase, a mere 4.6% happens, they will still be paying close to 50% in tax than they did historically for the entire 20th Century.

              And, the deficit chart reflects that Tax Cuts for the Wealthy and Historically high deficits look like Siamese Twins (See chart above)

              The Tax Rate History is our friend.

              In 2009, only 1,198,412 Americans earned more than $250K !!

              In 1982, their TAX HOLIDAY BEGAN. The tax rate dropped 20%!  From

              90%  The tax rate, 1944 - 1964, to
              70% where it remained until it dropped to
              50% in 1982.  Not good enough!  It dropped AGAIN to
              38.5% in 1987.  Still not good enough.  It dropped AGAIN to
              28% in 1988!  Bush I, increased it to
              31% in 1991, Clinton increased it to
              39.6% in 1993, and Bush II dropped it AGAIN to
              38.6% in 2002.  Still not good enough.  Bush II dropped it AGAIN to
              35% in 2003.

              There were No Tax Holidays for the majority of us, however.  
              Since 1941, most income earners have paid between 20% - 28% income tax consistently!

              Why aren't the Democrats framing the issue and asking:

              "How will Increasing the tax rate by a mere 4.6%, for only 1,198,412 people, create jobs?  

              Why continue the 30 Year TAX HOLIDAY that only those earning over $250K have enjoyed?

              10.2.10 March On Washington ROCKED http://www.onenationworkingtogether.org/pages/march-details

              by War on Error on Sat Nov 20, 2010 at 10:23:35 AM PST

              [ Parent ]

        •  Burrow (1+ / 0-)
          Recommended by:
          War on Error

          You're referring to parts of Reagan's "Supply Side Economics" argument - the more tax transactions, the more revenue that is taken in by the Treasury.

          However, I just wonder how much of the tax revenue increases were the direct and indirect result of the enormously high inflation rate that existed during the Reagan years.    

          •  And, really, Reagan's Deficit speaks volumes (1+ / 0-)
            Recommended by:
            Major Tom

            Tax Cuts and Deficits are like Siamese Twins

            Inseparable.

            BO, you seem to have me on your "Alert System".  Regardless of what time of day I post, BO you jump in.  Is there more than one BO?  A team perhaps?

            It's uncanny, really.

            10.2.10 March On Washington ROCKED http://www.onenationworkingtogether.org/pages/march-details

            by War on Error on Sat Nov 20, 2010 at 09:54:02 AM PST

            [ Parent ]

            •  I'm interested in tax policy. (3+ / 0-)
              Recommended by:
              Major Tom, papicek, War on Error

              It shouldn't be a surprise I comment on your tax diaries.

              •  Me, too. But your instant arrival (1+ / 0-)
                Recommended by:
                papicek

                whenever I post, which happens day and/or night, is amazing.

                How do you know when I post?  There are either more than one of you, or you have some sort of alarm.  Either way, there seems to be a 24 hour surveillance.  I've tested it this week, btw.

                Also, more often than not, you quite sharply criticize and discredit me instead of the information.

                Today, you are being much more helpful, for which I am very appreciative.  Thank you.

                Hey, BO, we are all in this Boat America together.

                I am always willing to say

                "You know, I'm not sure, but let's analyze this together"

                Perhaps if more were capable of doing the same, we could get to some resolutions of our huge issues.

                Can't we all just admit

                "Not really sure, but let's examine the.....together"

                And not attack the well-intentioned messenger?

                dare I dream.

                10.2.10 March On Washington ROCKED http://www.onenationworkingtogether.org/pages/march-details

                by War on Error on Sat Nov 20, 2010 at 10:31:30 AM PST

                [ Parent ]

          •  It's not about supply side anything; (2+ / 0-)
            Recommended by:
            Major Tom, papicek

            it's about the definition of income.  If, say, we define "taxable income" as income less any interest you pay, then that will be a smaller pool than defining it to exclude any deductions for most forms of interest.

            Simply by tweaking definitions, the latter will increase taxable income relative to the former.  That was, of course, one of the moves in the 1986 law.

            •  We are only discussing W-2 Income. (2+ / 0-)
              Recommended by:
              Major Tom, papicek

              bo, are you paid to stalk diaries like mine?

              10.2.10 March On Washington ROCKED http://www.onenationworkingtogether.org/pages/march-details

              by War on Error on Sat Nov 20, 2010 at 10:00:26 AM PST

              [ Parent ]

              •  I also like correcting mistakes, (2+ / 0-)
                Recommended by:
                Major Tom, papicek

                and your diaries present a target rich environment.

                re: w-2 income: no, we're not.  Major Tom was discussing the impacts of base broadening in tax policy.  That encompasses tax policy generally.

                •  Mt did so in response to your diversion (0+ / 0-)

                  10.2.10 March On Washington ROCKED http://www.onenationworkingtogether.org/pages/march-details

                  by War on Error on Sat Nov 20, 2010 at 10:35:52 AM PST

                  [ Parent ]

                •  tell you what's not a mistake... (0+ / 0-)

                  and this comes directly from the data linked to in the diary, is that drastic tax cuts at the top end of the scale don't contribute to greater economic activity, but do contribute to bubble markets and/or bursts of inflation, as the supply side seems to absorb the extra revenue very quickly.

                  The correlation appears to be spot on, and I'm going to dig into this some more.

                  We need to be STRONG because Obama is not.

                  by papicek on Sat Nov 20, 2010 at 11:35:21 AM PST

                  [ Parent ]

            •  Burrow (1+ / 0-)
              Recommended by:
              papicek

              In the manner in which you discuss your point, you're right. When Reagan tweaked some definitions of taxable income and allowable deductions, the tax revenues did increase. But I dare say that the middle class was hit hardest as a result of that bit of tweaking.  

              •  Because they DECREASED HUGELY (2+ / 0-)
                Recommended by:
                Major Tom, papicek

                for the wealthy.

                They increased at the same point in history when the

                WELFARE QUEEN scare was being spread by Reagan.

                And, when the so-called welfare queen got that job and looked at her paycheck, it was less because she now began to pay the higher rates while

                THE RICH PAID LESS AGAIN

                Just go read the Tax History link in the diary above.

                10.2.10 March On Washington ROCKED http://www.onenationworkingtogether.org/pages/march-details

                by War on Error on Sat Nov 20, 2010 at 10:37:42 AM PST

                [ Parent ]

          •  There is a not about this if you review (1+ / 0-)
            Recommended by:
            papicek

            the year by year tax history, see link in diary.

            10.2.10 March On Washington ROCKED http://www.onenationworkingtogether.org/pages/march-details

            by War on Error on Sat Nov 20, 2010 at 10:24:35 AM PST

            [ Parent ]

    •  Simpson's plan increases middle class taxes (4+ / 0-)
      Recommended by:
      Major Tom, JeffW, papicek, War on Error

      by $1 Trillion, and cuts taxes on billionaires.

      •  That's what Reagan did! (1+ / 0-)
        Recommended by:
        papicek

        And it continues.

        Simpson wants to make that even more unfair?  Nice.

        Folks, we are only talking about a mere 4.6% increase on the income of 1% that earn $250,000 or more.

        Where is the progressive tax?

        Why should someone making a mere $250,000 pay the same increase % as someone making $20,000,000?

        Check the Wage Chart in the diary.

        How unfair for those making between $250K and $1,000,000.

        The few making $20,000,000/year can afford to pay 50% tax, leaving them with $10,000,000.  Do you think they can squeeze by on that?

        The tax table is NOT progressive for anyone, low or high wage earners.

        Lowest should pay only the 7.65% FICA
        Highest should pay 50% (minimum) tax AND 7.65% FICA

        It would still be much lower than what highest wage earners paid for the entire history of 20th Century tax rates (with the exceptionof 1925 - 1929 when it was only 25%, we know how that turned out, right?)

        10.2.10 March On Washington ROCKED http://www.onenationworkingtogether.org/pages/march-details

        by War on Error on Sat Nov 20, 2010 at 09:59:27 AM PST

        [ Parent ]

    •  What you quote was followed with this: (2+ / 0-)
      Recommended by:
      Major Tom, papicek

      HOWEVER, TAX RATES MUST NOT FURTHER IMPOVERISH THE MAJORITY OF AMERICANS THAT BARELY MAKE A LIVING WAGE.

      Cuts or Not:  Congress needs to pass an "IRS Fair Tax Adjustment Law" to ensure that hard working Americans, who haven't seen an increase in wages for 30 years are protected, not punished by the present disproportionate tax rates.

      10.2.10 March On Washington ROCKED http://www.onenationworkingtogether.org/pages/march-details

      by War on Error on Sat Nov 20, 2010 at 09:47:48 AM PST

      [ Parent ]

  •  I think the deficit should be paid back by those (6+ / 0-)

    that caused it, the elite 1 percenters.  Putting it on the backs of the middle and working classes is inhumane.
    But that's just me.  

    S.A.W. 2011 STOP ALL WARS "The Global War on Terror is a fabrication to justify imperialism."

    by BigAlinWashSt on Sat Nov 20, 2010 at 09:27:27 AM PST

    •  Right, Big Al (5+ / 0-)

      How about a transactional tax on all stock market transfers?  

      •  Helpful, but I think the entire system needs to (3+ / 0-)
        Recommended by:
        Major Tom, papicek, War on Error

        be changed.  There's something wrong with so many people making that much money on something like that.  

        S.A.W. 2011 STOP ALL WARS "The Global War on Terror is a fabrication to justify imperialism."

        by BigAlinWashSt on Sat Nov 20, 2010 at 09:37:18 AM PST

        [ Parent ]

        •  A truly progressive tax rate is where we began (1+ / 0-)
          Recommended by:
          papicek

          Regan ended that.

          Here's a suggestion:

          A true Progressive Tax

          Keep in mind all income, even for the poorest wage earner, pays 7.65% to FICA up to $106,000.

          FICA should be paid on all income, especially by the higher wage earners.  Why should their income be exempt in what is touted as being a Progressively Taxed population:

          One tax rate for each income bracket for all, including Singles

          0% for the lowest wage:  $0 - $5,000 (they still pay the 7.65% FICA)

          3% for $5,001 - $12,000
          4% for $12,001 - $16,000
          5% fir $16,001 - $25,000
          8% for $25,001 - $42,000
          10% for $42,001 - $50,000
          12% for $50,001 - $62,000
          13% for $62,001 - $75,000
          14% for $75,001  - $85,000
          25% for $85,001 - $100,000
          30% for $101,000 - $200,000
          35% for $200,000 - $500,000
          45% for $501,001 - $5,000,000
          55% for $5,000,001 - $10,000,000
          70% over $10,000,000

          10.2.10 March On Washington ROCKED http://www.onenationworkingtogether.org/pages/march-details

          by War on Error on Sat Nov 20, 2010 at 10:05:09 AM PST

          [ Parent ]

  •  Excellent (4+ / 0-)

    Well researched and informative Diary.  Tipped and Rec'ed!  Hope it makes the Rec. list so it gets the attention it deserves.

    "Some men see things as they are and ask, 'Why?' I dream of things that never were and ask, 'Why not?"

    by Doctor Who on Sat Nov 20, 2010 at 09:30:03 AM PST

  •  Social Security is only in trouble... (5+ / 0-)

    if the US government intends to default on the loans Social Security has made, by law since the program was initiated, of its surpluses to the Treasury.

    It sounds as if this is exactly what the GOP wants to do. Heaven forbid a fraudulent foreclosure gets shot down though.

    We need to be STRONG because Obama is not.

    by papicek on Sat Nov 20, 2010 at 09:32:25 AM PST

    •  Papicek (2+ / 0-)
      Recommended by:
      papicek, War on Error

      Every single dollar (and much more) collected and paid into the Social Security Trust since 2001 went to paying for the Tax cuts for millionaires and billionaires over that same period of time. Now they want us to pay for it again. Moreover, while we're doing exactly that, they want to continue the tax cuts for the uber-rich. Isn't this insane? Yet they'll probably get away with it. Can you say "cave-in?" Good luck, folks.

      •  Great comment. (2+ / 0-)
        Recommended by:
        Major Tom, papicek

        Favor?

        Can you share some insight into the question just below?

        Thanks.

        10.2.10 March On Washington ROCKED http://www.onenationworkingtogether.org/pages/march-details

        by War on Error on Sat Nov 20, 2010 at 09:45:09 AM PST

        [ Parent ]

      •  yup... (1+ / 0-)
        Recommended by:
        Major Tom

        their strategy is to "starve the beast" (their words, not mine) to get a government they can fit in their pocket.

        I'm not having a good day here. More union busting in PA, Citibank announcing plans to build a huge new office in Hong Kong to make "substantial investments" (again their words), Bob Herbert's op-ed which assumes the situation is better than it is, Krugman on the axis of China, Germany and the GOP all trying to force to fed to abandon job creation (even though that is part of the fed's charter for chrissakes), Jan Brewer and Arizona rethugs refusing critical, lifesaving care to seriously ill individuals, and I'm here thinking of the white, working class individuals whom I've seen begging in the suburbs of Boston for the last 18 months.

        Like I say, not having a great day here and I have zero tolerance today for "third way" democrats, from whom we're hearing crickets. Fucking crickets.

        All I need now is BWD to make a snooty comment here to set me off.

        We need to be STRONG because Obama is not.

        by papicek on Sat Nov 20, 2010 at 10:08:30 AM PST

        [ Parent ]

    •  Here's an important questions? (2+ / 0-)
      Recommended by:
      Major Tom, papicek

      What was put up as collateral to the Social Security Trust, when Bush Co, borrowed from it?

      This is a burning question.

      It would be great if others share their research to answer it.

      Thanks.

      10.2.10 March On Washington ROCKED http://www.onenationworkingtogether.org/pages/march-details

      by War on Error on Sat Nov 20, 2010 at 09:44:05 AM PST

      [ Parent ]

    •  The interest we pay on the treasury bonds (3+ / 0-)
      Recommended by:
      Major Tom, papicek, War on Error

      does hit the deficit.  It's debt servicing, which is a current expense.

      •  This is a great addition, BO (1+ / 0-)
        Recommended by:
        papicek

        And, as you seem quite informed, would you take a moment and provide us with some empirical evidence.

        Charts would be the best.

        Or are those charged with reporting shying away from this important point.

        Is the CBO reporting the Deficit Impact of Bush Co's assault on the Social Security Trust Fund?

        Thanks.

        10.2.10 March On Washington ROCKED http://www.onenationworkingtogether.org/pages/march-details

        by War on Error on Sat Nov 20, 2010 at 10:09:24 AM PST

        [ Parent ]

      •  what's the rate nowadays? (0+ / 0-)

        practically zero.

        We need to be STRONG because Obama is not.

        by papicek on Sat Nov 20, 2010 at 10:17:20 AM PST

        [ Parent ]

    •  That's their problem in a nutshell (0+ / 0-)

      interest on money borrowed by the Treasury from the Social Security Trust fund -- would add $154 billion in revenues

       That is part of the debt they want to get out from under.

      How much do they owe us?

  •  Entitlements, not insurance (2+ / 0-)
    Recommended by:
    FishOutofWater, War on Error

    Entitlement is not a bad word - it's only been made so, like liberal.
    To be entitled to something means you have a right to it, a legal claim to it. Insurance is something you only get if you need it - it's a word that leads to means testing.

    •  Glen Beck attacked the word Entitlement (1+ / 0-)
      Recommended by:
      FishOutofWater

      hugely yesterday on TV.

      Backed by a Rabbi.

      It was a shocking reprimand to the concept of giving.

      In their discussion, giving was a bad thing, that is not good for the soul of those receiving.

      It was a ruse.

      We need to push back against the word.

      Social Security, Medicare, and Unemployment are Insurance Programs, paid with FICA out of each of our paychecks.

      The premiums we pay accrue interest compounded over time, like any other insurance program.

      Nothing is more misrepresented by the media than how Social Security Insurance programs are paid for and how they remain solvent over time, imo.

      10.2.10 March On Washington ROCKED http://www.onenationworkingtogether.org/pages/march-details

      by War on Error on Sat Nov 20, 2010 at 10:12:54 AM PST

      [ Parent ]

      •  How the word got degraded (1+ / 0-)
        Recommended by:
        War on Error

        Some people act like they are entitled to special consideration, and we got to using the word with a sneer in those cases. Of course, it means the opposite - you may be acting like you have a right to something when you actually don't. It's not a word that should be pushed back against - it should be reclaimed.

        On the unrelated subject of the spirit of giving, we had a doozy of a letter in our paper this morning. It was in reference to the increasing cost of school lunches

        If a woman or couple brings a child into the world, a voluntary decision, it is their responsibility. Not mine. If they can't afford that child, that is what orphanages are for.
        I have no problem paying taxes for orphanages for children whose parents become destitute.
        But I have a huge problem subsiding raising them so that the children or parents can have cable TV, cellphones, WiFi, smart phones, fancy clothes and pocket money to waste. It is not our responsibility to subsidize the improvident, the lazy, addicts, alcoholics and others who can not or will not do what is necessary to succeed.

        http://letterstotheeditorblog.dallas...

        •  Well, looks like Fox news is doing it's job. TMI (1+ / 0-)
          Recommended by:
          Catte Nappe

          That said, in a county near me there are 6 Meth Addict centers requiring daily doses for the addicts.  Each pays $80 out of pocket a week.

          Someone is profiting.  Certainly not the community.

          A friend of mine was almost rear ended by one.  Followed them to the clinic at 7AM.  Watched the newly dosed drive away.  This is a danger to society, as they are high when they leave.

          Crazy world.

          Another friend knows of one of these addicts who just had her 4th child.  All had to spend time in ICU to detox.  Infants detoxing.  Nothing is done to stop the addicts from procreating which, I guess, would be against so many of our principles.

          All I can surmise is that it must be profitable to some to keep addicts, addicts.  Jails, prisons, rehab centers, ICUs, drug treatements, etc.

          Is addiction a profitable business for some?  Too many?  other than the dealers, I mean?

          It's definitely not profitable to society at large. Unless you factor all those employed to treat/detain the addicts.

          Why can't these people be really helped instead of leaving them to do further harm to themselves and children?

          Regardless, giving is giving, and I don't see anything right about discouraging giving.  It is a gift to the giver.

          Beck suggested yesterday that "Receiving help isn't good for the soul", thus discouraging giving.  Really?

          Children have no fault in the circumstance of their birth.  And those born into the worst of situations, deserve the most compassion and help, imo.

          Punishing children for parents choices is a very slippery slope.  For those decrying a nanny state, why would they suggest the ultimate nanny:  Orphanages?

          Having been raised in one for the first few years of my life, I can't say it was a bad beginning, but one that offered many challenges throughout life.

          10.2.10 March On Washington ROCKED http://www.onenationworkingtogether.org/pages/march-details

          by War on Error on Sat Nov 20, 2010 at 11:37:06 AM PST

          [ Parent ]

  •  tip'd, rec'd & Tweeted (1+ / 0-)
    Recommended by:
    War on Error

    It's Class War, and all of us on this side of the economic divide know it and are willing to admit it.

    When will our Government admit it? Because, you know, when they do they'll have to do something about it.

    It's time in the economic cycle for the uber-wealthy to be taken down a few notches, so that the 90% of the rest of us can feed and house our families in something approaching first world standards.

    The correction was ugly the last two times (late 1800s and the Great Depression), and I expect it to be uglier, this time around.

    I keep hearing about torches and pitchforks - but it's just about happening in Europe, and it can happen here, too.

    Something, somewhere has to give, it's just a matter of time...

    "in Order to form a more perfect Union"
    Basta de Guerra. No más. Enough War. No more.

    by Angie in WA State on Sat Nov 20, 2010 at 12:22:05 PM PST

    •  Thank you, Angie (1+ / 0-)
      Recommended by:
      Angie in WA State

      Some have suggested that there are too many issues to tackle our UNprogressive tax rates.

      I say that Tax Rates, Poverty, Security, and the Deficit are tied together, no locked together.

      Adjust one, and the others are affected either positively or negatively.

      What Reagan did, and the other Presidents since, have caused our current economic disaster.

      Tax Cuts for the Wealthy, the increase in poverty and the Deficit seem to be clearly tied together, not to mention our crumblling infrastructure, deteriorating K-12 education, etc.

      Why do we keep following failed policies?

      Because the Rich are in DC Making the laws.  Do Senators and Congresspeople want to pay higher taxes?  Well, we will have to see, right?

      Because of our high and practically flat tax on the majority of Americans FLAT wages (no increase since the 1980s) there isn't enough liquidity to improve the economy from the ground up.

      The Presidents have hidden our deplorable state of affairs for the majority of Americans under Bubble after Bubble after  Bubble.

      Perhaps one day history will call these four Presidents "The Bubble Presidents".  Will Obama join them in this unflattering title?

      Time will tell.  But it's not looking too good.  He's boxed in, or should we say he didn't prevent himself from being boxed in?

      10.2.10 March On Washington ROCKED http://www.onenationworkingtogether.org/pages/march-details

      by War on Error on Sat Nov 20, 2010 at 12:56:07 PM PST

      [ Parent ]

      •  It's like Obama campaigned as "Rocky" (0+ / 0-)

        and so the Democratic Base expected him to come out fighting, on January 22, 2009...

        but when he assumed the office, it was in the persona of (sorry, Sen. Franklin & SNL) Stuart Smalley, ever looking on the bright side and thinking everyone will be my friend if I just try hard enough to make them like me...

        It's been a tragedy of monumental proportions, so far as I can tell.

        The Obama Administration took the biggest, most populist movement in history, since the 60s - and just dropped it, like a hot potato. Leaving all of the activists and motivated Base with nothing to contribute, for months on end.

        Then wasted all of that Political Capital on a truncated, non-cost-controlling HCR bill that too many don't understand and/or support.

        Leaving DADT, Immigration Reform and JOBS legislation for some other day... when progress on these three issues could have produced a mid-term 2010 election that would have increased the Democratic Majority in the US Congress.

        How can such an obviously intelligent man make so many wrong steps on political policy and strategy?

        "in Order to form a more perfect Union"
        Basta de Guerra. No más. Enough War. No more.

        by Angie in WA State on Sat Nov 20, 2010 at 01:30:53 PM PST

        [ Parent ]

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