FICA Cut Likely To Pass

It appears that Congress will pass the tax cut compromise that will reduce the FICA tax "temporarily" while crediting the Social Security trust funds with the money they were supposed to receive.

There has been virtually no time for discussion of the long term Social Security consequences of this bill. This has been treated as a non-issue by almost everyone. There is every reason to be skeptical of the argument that this is only temporary. We are embarking upon a course that poses a grave long term danger to Social Security.

Update: I am not being paranoid. Congressional Republicans are making no secret of their plans:

Republicans acknowledged that the expiration of the tax holiday will be treated as a tax increase. "Once something like this goes into place, a year from now, when it expires, it'll be portrayed as a tax increase," said Sen. Bob Corker (R-Tenn.). So in a body like Congress, precedents matter and this is setting a precedent. I think that certainly is going to create some problems down the road if it passes." ...

"Once you bring a rate down, if it goes back up, people will feel that. They'll feel their paycheck being less and that argument" -- that letting it expire amounts to a tax hike -- "eventually is bound to be made," said Sen. Mike Johanns (R-Neb.).

"There's always a tendency to continue those things... Once something comes in, it's very difficult to change it," said Sen. George Voinovich (R-Ohio.) He then volunteered, without prompting, that "It would be detrimental to the Social Security system, especially when it's in bad shape." ...

Lamar Alexander, the Senate's number-three Republican, also said that reform of Social Security should be tied to moving that tax rate back up. "My personal hope is that it doesn't become permanent unless we deal with a way to make Social Security solvent over the long term ...

It also undermines the self-funding nature of the program, Bob Corker observed. "It really begins to break down the whole notion even further of a Social Security trust, when general fund money is going in," he said. "We've already abused the Social Security trust and there's no question that taking this action is just another portion of the camel nose under the tent."

Corker said he would have liked to see Social Security reform coupled with the tax cut.