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.
DeleteEliminate the cap and go back to the pre Ronald Reagan tax rate. Yes, SS is not supposed to be the only means for retirement but the majority of companies have gotten rid of pensions in favor of 401ks
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.
Highwaymen were progressives and never even realized it.
ReplyDeletethere is no cap on the medicare tax and no one complains
ReplyDeletethere will never be a 22% cut in benefits, we all know it, its just a matter of someone figuring out how to spin it, the cap doesnt eliminate the entire problem, its not a magic bullet, there is going to be a tax increase, would have been less if this was addressed by the boomers say 30 or 40 years ago, but they didnt want to tax themselves, now they are mostly out of the workforce (except in congress) they will have no problem taxing someone else higher to get paid.
ReplyDeleteWhat gives you this confidence and optimism? Is it the hopelessly broken state of politics in America? The consistent inability by Congress to get even the simplest and least controversial legislation passed? The fact that America’s government has failed to avert so many other catastrophies that people said would never be allowed to come to pass?
DeleteSomething was done 43 years ago but something new is needed now. Actually about 20byears ago the fixes would have been much easier to stomach. Boomers were hit with higher retirement age.
DeleteIf I earn $1,000/hour and work 80 hours/week, it would take me 240 years to earn $1 billion (much less $1 trillion); if I work 24/7, it would take me 114 years. No one - not musk, not bezos, not buffet, and most certainly not trump - is worth that much. The billionaires have been stealing from us for years. Time to take back 1% (or more) in a wealth tax.
ReplyDeleteYou think that achievement must be measured in hours, huh? If I discover a cure for cancer and it takes me, say, 2 years, then I should get what for my invention? All you really want is a license to put a veneer on your robbery. And of course any government that would rob Peter to pay Paul can count on the support of Paul. Duh.
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