The Netherlands is having trouble financing its social security systems. Cuts in benefits are being discussed. According to the NL Times, one solution being discussed is a wealth tax. Wealthy people might be taxed not just on their income but on their wealth as well.
A possible wealth tax is on the periphery of public discussion in the U.S. Only people like Senator Bernie Sanders talk much about the idea and then not in the context of Social Security. However, if the choice is between massive Social Security benefits cuts, removing the FICA cap or a wealth tax, what do the American people want? Remember, there’s no clever way of doing this. Your choices are limited to cutting benefits and/or raising taxes. Is getting more tax money out of the ultra wealthy, such as Elon Musk, such a bad idea?
The solution is to eliminate the cap.
ReplyDeleteThe inherent problem with "eliminating the cap" is that those people will not see a return on the higher taxes paid unless they change the formula to afford those same people more in benefits. It is truly unfair! That's the truth and now here is another truth, if benefits are cut it will be a economic and social disaster, as SS is not meant, has never been meant, to replace income but only to supplement it and people are struggling as is! I am struggling with a SSDI check and may not have a place to live soon as I have been on this for 24 years and started collecting at 37 years old. I would like to say "do whatever it takes" but it has to be fair! It may seem I am playing both sides, but that is because I need to look at things fairly and not just as I want them to be. I wish I had the answer.....
ReplyDeleteIt’s only “unfair” if you think paying taxes to help the less fortunate is unfair, which apparently roughly half the voters (and most of the hardline “Christians”) do. If you needed confirmation that Americas society is declining into moral rot, this ought to do it.
DeleteHow would you feel if your benefits were cut 22%? Is that going to help cover your expenses? This is not the time to being neutral on strengthening the trust fund.
DeleteA hybrid system of Australia and US is a good solution. Slowing phasing out the US system over the next 30 years and incorporating the Australian one.
ReplyDeleteIn the meantime, take away the cap, dip into DIB and have a 1% wealth tax to start funding the new system.