It is now the year 2017 and the fox is officially in charge of the henhouse. The Republicans still control the House and the Senate and are about to control the White House. There is now no limit to their potential mischief.
While Republicans have not actually used these words, it is safe to say they plan to rollback 100 or more years of progress. With Republican leadership it appears we will be marching back to the 19th Century.
High on the Republican agenda is "saving" Social Security. They want save it by allowing Americans now working to take their Social Security payments and invest them. We all know just how safe the money will be with that plan. How many Americans watched their Individual Retirement Accounts (IRA) lose value in the last recession? And what do the Republicans plan for those who make bad investment decisions? It might be safe to say the Republicans want to "save" Social Security by destroying it.
According to reports, at the rate we are collecting money and the rate we are paying it out for benefits, the Social Security Trust Fund will run out in 2034. The Republicans plan to extend this period by basically doing away with Cost of Living Adjustments (COLA) and cutting the monthly benefits to our retirees.
It had been suggested that we could extend the life of Social Security as we know it to about 2070 by doing away with the Taxable Maximum. If you are lucky enough to be a high earner, the Taxable Maximum is amount you make that is subject to Social Security taxes. Everything above that is not subject to those taxes.
Eliminating the maximum would require working Americans to pay Social Security taxes on all their earnings, no matter what that may be. Speaker of the House Paul Ryan rejected this idea because he said he won't raise taxes.
According to the Social Security Administration, in any given year about six percent of workers earn more than the Taxable Maximum, which in 2017 is $127,200. In 2016 the amount was $118,500.
So Ryan does not want to take additional money from these wage earners, since he would have to raise the Social Security Tax for them. The tax for an individual employee in 2017, as it was in 2016, is 7.65 percent. For the self-employed, the rate is 15.30 percent.
As an example, for someone earning $127,200 per year, the tax will be $9,730.80, 7.65 percent. For those earning $250,000 per year, the tax will be $9,730.80, 3.89 percent. If that person earning a quarter million a year had to pay the full 7.65 percent, the tax would be $19,125.
So, eliminating the Taxable Maximum would be a tax increase for that six percent of the workforce called high earners. Another way to look at it is eliminating the maximum means the six percent would have to pay the same as the 94 percent. We haven't raised the tax. All we have done is broaden the pool of people who fully pay them.
Paul Ryan does not want to take the needed money from those now working and earning big money. Instead, he wants to take the money form the retired who are receiving less money. Isn't cutting the benefits for our retirees about the same as raising their taxes.
