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I am all for helping out working Americans, but continuing or expanding the payroll tax cut is a danger to Social Security, and Republican opposition seems a like Brer Rabbit asking not t be thrown in the briar patch. It gives them a great opening to politicize the money of Social security more than ever before.

Paraphrasing what I said when this cut was first proposed and passed last year - "good luck trying to call it back". Payroll tax cuts put Social security into budget play when it does not have not be there at all. It is half-penny-wise and 3 pounds foolish, as it offer little help to the middle class and poor, while further endangering their quality of their later life.

What we need are jobs. We do not need to be taking money out of social security paryoll tax stream.

I understand about pragmatism, bi-partisanship, election year politics, the art of the possible. But a bad idea can still be a bad idea, even if your side proposes it, even if it can pass, even if it had bi-partisan support, even if is seems pragmatic short term.

Social security is a success story. Even though the money lost to SS in the cut must be recouped from the general fund, such as action opens SS to political partisanship in an entirely new way, and increases the future chance that the program will become a political football.

Continued cuts to social security payroll taxes could in future make SS fully funded by general funds -thus making it far more a part of the general budget that it ever was before, with all the filibustering, political posturing, and backroom negotiations that go on with budgets.

Want to cut social security payroll tax on middle and lower incomes ? Then increase the income level subject to payroll taxes so that replacement money comes in the system the same way, WITHOUT opening it up to political f*cking about.

In any case, the real issue is jobs and the corrupting disfunction of the American economy, and no one on either side seems to want to do what is necessary to fix that. Payroll tax muckery is just election year posturing, and partisan one-upmanship. it does not help the country.

Originally posted to Thucydides Junior on Thu Dec 01, 2011 at 08:55 AM PST.

Also republished by Social Security Defenders.

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Comment Preferences

  •  Tip Jar (10+ / 0-)

    "When you enter the ocean, you enter the food chain, and not necessarily at the top." - Cousteau

    by Thucydides Junior on Thu Dec 01, 2011 at 08:55:10 AM PST

  •  The problem is, the payroll tax cut only gives (6+ / 0-)

    a small rebate (2% up to the cap) to those who already have jobs. That's why it's a weak stimulus. Not the weakest stimulus, but still a weak one.

    The money it takes to reimburse SS for a 2% payroll tax cut on 140 million employed workers could give full time direct employment to 2.8 million workers, with a similar distribution of wages.

    These 2.8 million newly employed workers would cease being a burden to their friends and families, they would be contributing to, rather than drawing down, unemployment insurance and FICA. And they would be in a position to buy goods and services beyond the mere essentials for survival, kickstarting the economy for further employment.

    So what's smarter, giving people who already have jobs around $20 a week more to spend (that's what the median household gets from the cut), or giving full-time salaries to the people who've got almost nothing to spend?

    Non enim propter gloriam, diuicias aut honores pugnamus set propter libertatem solummodo quam Nemo bonus nisi simul cum vita amittit. -Declaration of Arbroath

    by Robobagpiper on Thu Dec 01, 2011 at 09:06:02 AM PST

    •  The First One, for Our 2 Conservative Parties nt (0+ / 0-)

      We are called to speak for the weak, for the voiceless, for victims of our nation and for those it calls enemy.... --ML King "Beyond Vietnam"

      by Gooserock on Thu Dec 01, 2011 at 09:09:59 AM PST

      [ Parent ]

      •  Conservatives from before Burke (1+ / 0-)
        Recommended by:

        have always assigned the unemployed to the category of "undeserving poor". At least any unemployed whose personal circumstances weren't known to them. In fact where possible such were kept from collecting what the British called 'outside relief'. It is illuminating to see the  ore old-fashioned English word for 'unemployed' which was 'idle' and the agency suggested as contrasted with the less common 'idled' which may indeed only come into usage with tthe advent of industrial capitalism.

        In Americathis has been so heavily overlaid with racism as to lead many of us to put this at the root. Bit the commonality of the British and American experience on this shows there is something even deeper. Something that may well underly the more vulgar forms of Calvinism and then Social Darwinism. In what I would dub Primeval Conservatism the able bodied poor can never be victims, except perhaps of their sins, and deserve what they get, ideally nothing.

        In the U.S. we just get to pile racial, misogynistic, and class notions on top of that: 'strapping young buck', welfare queens, trailer trash. Because not all white men fall I to the class of  innately privileged. With apologies to some of my old friends in Ethnic and Women's Studies, I spent some years in a town that was just about lily white and had a literal right and wrong side of the tracks, actual railroad tracks paralleled by a street named I shit you not Division Street. And the (in the local parlance) 'good' people North of the tracks knew exactly why the housing etc south was so dismal, they were lazy people. Of course no one stopped to ask why the streets north of the tracks were beautifully maintained while the ones south were rutted, or if they did but it down to the Primeval Comservative excuse for EVERYTHING: 'I pay taxes' unlike the lazy trash over wherever.

    •  Well put (1+ / 0-)
      Recommended by:

      You could expand this just a little and post it as a diary.

      Shop Liberally this holiday season at Kos Katalog

      by JamieG from Md on Thu Dec 01, 2011 at 01:28:16 PM PST

      [ Parent ]

    •  Employer side is pretty darn weak (0+ / 0-)

      Employee side is a tad better. Overall a pocketful of meh...

      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 Dec 01, 2011 at 02:34:01 PM PST

      [ Parent ]

    •  Excellent idea, but... (0+ / 0-)

      The Dems would run scared when the repubs cried class warfare and socialism. But a mighty fine idea regardless.

      "When you enter the ocean, you enter the food chain, and not necessarily at the top." - Cousteau

      by Thucydides Junior on Fri Dec 02, 2011 at 12:22:57 PM PST

      [ Parent ]

  •  Best Single Rightwing Move Democrats Have Made (3+ / 0-)
    Recommended by:
    CentralMass, snoopydawg, gustynpip


    We are called to speak for the weak, for the voiceless, for victims of our nation and for those it calls enemy.... --ML King "Beyond Vietnam"

    by Gooserock on Thu Dec 01, 2011 at 09:09:12 AM PST

  •  SS is not included in the payroll cuts. (1+ / 0-)
    Recommended by:

    SS & Medicare are still being deducted at regular rates. It's the FIT that is lowered/lessened with the cuts.

  •  I have serious concerns about this as well ... (5+ / 0-)

    because one of the strongest arguments protecting SS is that it is a national insurance program, not "welfare".  For better or worse, we have decided to decrease the contribution each worker makes, and thus subsidize from the general fund.  History tells us that these tax rates will never return to a sustainable level for SS, endangering the entire system.  Erick Erickson of is even advocating making these tax cuts permanent.  Does anybody think this generous offer is in SS best interest?  I think this is dangerous, because now the GOP will claim SS is just more "welfare" to be cut.  And what does this get us?  A temporary increase in consumer spending?  Folks, the problem is the US economy needs to restructure.  We have too much debt of all kinds, but in particular, too much consumer spending and personal debt, and not enough export to developing markets.  Subsidizing consumerism does not get us closer to a more sustainable economy, it mearly perpetuates the consumer debt economic model.  I know people just love to be owned and controlled by massive mega-banks, because hey, that debt doesn't really matter anyways when you can drive a Volvo!  Sheesh.  This is bad for everyone.  And to then surrender SS as "welfare"?  

    I know I will not win this argument.  Folks will go ballistic and blast me about immediate needs.  However, I see this move as stupid and short-sighted, and likely to have significant consequences in the future.

  •  Totally agree (3+ / 0-)
    Recommended by:
    Robobagpiper, gustynpip, CentralMass

    Your diary is spot on. Unfortunately, this point is being completely ignored by the MSM.  I keep yelling at my TV and radio every time I hear a story on this proposed tax cut, because none of them pick up on this.

    Also, have you heard Pres Obama trying to sell the tax cut on the stump in Scranton yesterday? He is using every GOP talking point on why tax cuts are needed, like that is the only way to fix the economy. Such a bad idea.

    I say let the payroll tax cuts expire, along with the Bush tax cuts next year.

    The other thing that irks me about the tax cut plan is the Millionaires Tax being used as the 'pay-for'. It seems like the Administration thinks this is the only possible tax hike that they can win (due completely to the #OWS movement) so they're throwing it into every possible proposal they can come up with until it sticks. But it makes much more sense, as you say in your diary, to expand incomes subject to SS as a way to pay for this (and to shore up SS for the long term).

  •  Yes the payroll cut is stupid (1+ / 0-)
    Recommended by:
    Mac in Maine

    But there is pretty much no other way to put money into the hands of working people.  

    Here is the situation we are in now.

    The economy needs to improve.  The only way to improve it is if people spend more money.  Thus we need to put more money in the hands of working class people.  Big business and the rich are not going to do it.  Thus we must cut taxes.  However the only tax most of these people pay is the payroll tax, thus it's the only tax we can cut.  

    Of course, this is stupid though.  Because this feeds into social security being unable to pay for itself which walks right into the conservative talking point that social security should be destroyed.  It's full on idiotic to do it.

    What should be done is increasing the income that is subject to SS.

    "Foolproof systems don't take into account the ingenuity of fools."

    by overclocking on Thu Dec 01, 2011 at 10:04:40 AM PST

    •  Sure there is: direct jobs programs (2+ / 0-)
      Recommended by:
      m00finsan, gustynpip

      The bang-for-buck on direct jobs programs is several times that even for the best tax cut.

      Non enim propter gloriam, diuicias aut honores pugnamus set propter libertatem solummodo quam Nemo bonus nisi simul cum vita amittit. -Declaration of Arbroath

      by Robobagpiper on Thu Dec 01, 2011 at 10:18:41 AM PST

      [ Parent ]

    •  There are a ton of other - and better ways. (1+ / 0-)
      Recommended by:
      JamieG from Md

      Like giving a tax rebate.  Or increasing the exemption amount.  Or start a real jobs program.  This option was the most lame brain one possible.  Unless, of course, the real goal was to weaken SS.

      "If you trust you are not critical; if you are critical you do not trust" by our own Dauphin

      by gustynpip on Thu Dec 01, 2011 at 11:09:28 AM PST

      [ Parent ]

    •  Tax the rich bastards ;-) (0+ / 0-)
    •  How about 'Making Work Pay' (0+ / 0-)

      Which was the main programmatic victim of the payroll tax holiday. The Obama team cynically used funding previously targeting the working poor to partially backfill the gap created by giving a 2% tax cut to everyone making under $106,800. That is while OWS is right to target the top 1% there is an equally good case to despise the Third Way types so over represented on the Obama Teamwhose working slogan might as well be 'Fuck the Lower 20%. The key to winning election.'

      The Payroll Tax Holiday just being another example following on Obama's absurd decision to draw the line of folk that shouldn't sacrifice anything at all tax-wise at $250k. Is there a real moral superiority in pandering to the 50-98%ers? Which is operationally where the Third Way leads.

    •  I'd rather put money into the hands (0+ / 0-)

      of people who are unemployed. Hopefully by using funds for programs that will improve our infrastructure and create jobs.

      Shop Liberally this holiday season at Kos Katalog

      by JamieG from Md on Thu Dec 01, 2011 at 01:33:01 PM PST

      [ Parent ]

  •  Exactly right (1+ / 0-)
    Recommended by:

    But too many people on here, like the Democrats in Washington, can't see the forest for the treees.  They're so dazzled by this "brilliant" tactical move, that they don't see the long-term strategic corner they're backing themselves into.

    “If you think I can be bought for five thousand dollars, I'm offended." Rick Perry.

    by Paleo on Thu Dec 01, 2011 at 10:23:21 AM PST

  •  Even at a lower rate Social Security can be funded (1+ / 0-)
    Recommended by:
    JamieG from Md

    and totally solvent by extending the maximum salary affected to $200,000. Since the proposed other taxes on wealth kick in at or above that level there is no overlap to allow whiney negotiations (the only kind Republicants know).

    Republicans aren't so bad as long as they don't move next door, try to marry my child, or run for public office.

    by OHdog on Thu Dec 01, 2011 at 10:37:51 AM PST

    •  Republicans don't negotiate (0+ / 0-)

      They have a temper tantrum and walk away.

    •  That math doesn't add up (1+ / 0-)
      Recommended by:
      Roger Fox

      Per CBO you can indeed backfill 100% of the current actuarial gap by lifting the cap and letting benefits increase at current bend points, or 150%of the gap by lifting the cap while freezing benefits at the current maximum. But since the 50% of the current gap is only 1.1% of covered payroll and already hits at the 84% of payroll level, the idea that you can significantly lower the rate across the board just by the marginal tapping of the top 16% (whose first $107k is already tapped) seems numerically dubious.

      Can you point me to a scored plan on this? Because too many promoters of "Just scrap the cap" (including some policy friends of mine) seem to think it is the operations equivalent of the Horn of Plenty. Well rift metric doesn't allow a lot of room for Magic: so "Got numbers?"

      •  Good point. How about... (1+ / 0-)
        Recommended by:

        ... if we treated capital gains as regular income for both tax and SS purposes?

        "When you enter the ocean, you enter the food chain, and not necessarily at the top." - Cousteau

        by Thucydides Junior on Fri Dec 02, 2011 at 12:30:08 PM PST

        [ Parent ]

        •  How about we tax capital gains (1+ / 0-)
          Recommended by:
          Thucydides Junior

          At regular rates and use the money to educate our kids and fund universal health coverage.

          Social Security is not broke, it just needs existing obligations via the Trust Fund balances hindered plus some tiny tweaks in FIcA across the board that amount to 0.3% of payroll now and MAYBE some additional tweaks starting in fricking 2026. Do the math and check the spreadsheets via Google search 'Northwest Plan for a real social security fix' one of whose co-authors has a name oddly similar to my dKos User Name. Go figure!

          Every progressive who has bought into "Just lift the cap" has (perhaps unwittingly) bought into 'crisis'.

          Social Security isn't broke. Not unless you accept special assumptions by the bad guys. Under current law, past practice, and actual numbers workers can backfill social Security within its current structure without changing the cap, the retirement age, or the benefit formula for 40 cent a week reductuction in payroll. Hard to believe? Well Dale and I supplied the numbers for you and more importantly for top Social Security policy experts on both sides and NOBODY has challenged the arithmetic.

          Social Security is not "broke". It has a DI program that has been in shortfall since 2005. an OAS program fully solvent until about 2038 and a combined OASDI program solvent until 2036. The progressive solutions in lieu of the bad guys solutions are simply not needed.

          Tax the fuck out of capital gains for all I care. Take those rates and top marginal rates on income back to Reagan 50, Kennedy 70, Eisenhower 90, or since we seem to be in permawar Roosevelt peak 94% war time rates. Just leave Social Security alone in the process.

          Roosevelt took top rates from 66% at passage of the Social Security Act of 1935 to 94% at the height of the war. And devoted not a penny of that new revenue to backfilling his new Social Security Insurance program. Because he foresaw that "we paid for it" would pump the juice up in the Third Rail, since Social Security Insurance has never drawn on Capital it owes nothing to Capital. Once you start exposing Capital Gains to FICA you break down that Chinese Wall.

          God Save Social Security from its Friends. Dig in your couch for the 40 cents a week CBO tells us it would take to backfill the gap (yes in the first year but just equivalents after) and fund Social Security for the next 75 years and THEN go after the 1%'s wallets to fund the REST of the progressive agenda. In a rational world Social Security would be item no zillion on our agenda, what part of $2.6 trillion in assets are we missing? As opposed to UI benefits?

  •  Has the money (0+ / 0-)

    been paid back from the first cut?

  •  Payroll Tax Cut (0+ / 0-)

    will not hurt the SS fund one little bit.

    Why do you think Pres Obama has proposed a surtax on the rich?  If enacted, the funds raised from the surtax will be used to pay for the payroll tax cuts.  Instead of that, some Republicans want to lay off 200,000 more federal employees and extend the pay freeze to pay for the payroll tax cuts.  


    •  Why wouldn't it? (1+ / 0-)
      Recommended by:
      Mac in Maine

      Your implied argument simply assumes that a 15% cut in dedicated funding will always be made whole, in this case specifically with a surtax on millionaires. But what if the other side simply refuses to go along and the tradeoff is killing food aid and education for children? Not theoretical possibilities,that's pretty much the Republican counter proposal.

      What is your justification for 'not one little bit'? Expressed numerically?

      Under the Social Security Amendments of 1939 (which actually established the Trust Fund) all revenues collected by FICA are required to be credited to the Trust Fund. But nothing in that Act protects the rate by which those revenues are collected or the absolute level. Obama cut a deal whereby he blew a rate hole in that revenue stream and replaced it with some non-binding moral burden on future Congresses to make it right. To say that a longer term cut in a guaranteened stream of income will "not hurt the Trust Fund one bit" at the very least needs a fuller explanation.

    •  My Point was Politicization... (0+ / 0-)

      ... of the process. Yes, money goes back int SS. But doing it from general revenue opens it up to manipulation, hostage taking, bargaining etc., just like every other budget item. So, yes, it can absolutely hurt SS.

      "When you enter the ocean, you enter the food chain, and not necessarily at the top." - Cousteau

      by Thucydides Junior on Fri Dec 02, 2011 at 12:27:44 PM PST

      [ Parent ]

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