“This bill shows that Social Security is fully affordable—as long as the wealthiest among us pay their fair share,” said one advocate.
Legislation recently introduced by a pair of Democratic U.S. lawmakers to save Social Security for generations to come would extend the vital social program’s lifespan by at least 75 years, according to a federal analysis published Tuesday.
The idea behind social security is a forced time phased retirement program. The cap for input of money serves to cap the withdrawal later in years. If the wealthy put in a significantly larger amount while working they will be entitled to a proportionally larger about of withdrawal later. We’re just robbing peter to pay paul here and kicking the issue down the road.
A real solution would be to produce a margin that is invested in a total market fund that would eventually create self sustaining returns to both: pay out current withdrawals as well as grow to match inflation and population growth. But that’s not going to happen.
TLDR: The ponzi scheme will continue.
If the wealthy put in a significantly larger amount while working they will be entitled to a proportionally larger about of withdrawal later.
Why?
The wealthy put in more money towards taxes that go to other things which everyone benefits from equally. The wealthy don’t get better roads just because they pay a higher tax rate. Why should they have uncapped benefits from social security? Retired folks being able to live off social security is a benefit to all of society, it’s not meant to keep people at a high income with no other inputs. The wealthy can benefit from social security just like everyone else, and payouts should be capped, but they’re currently benefiting from society at a greater rate pre-retirement so that should be reflected in their contributions today. If they want to be wealthy in retirement, then they have the means to invest and supplement their future social security earnings.
Edit: I just realized some of my statements conflicted a little. My point is just that tax contributions are not expected to deliver a 1:1 benefit to the contributor for the service that is collecting tax. You don’t put in $1 towards roads and get $1 back of road use, or $2 towards schools and get $2 of education back. We all contribute for the betterment and support of society at large. The wealthy can afford to contribute proportionally more. They are getting the benefits of their taxes back in greater proportion than the rest of us by way of their wealth, they do not make that money purely off individual effort. Supporting retirees ensures they are not a drain on society’s resources and it’s important that the wealthy contribute enough to make this possible.
This is primarily where the moral argument and thus division appear. Is it fair to ask a person to pay more than their share? I would argue no, it seems a majority here would argue yes. I’m ok with being wrong and learning, but I have a hard time shifting what I believe to be moral foundations.
edit: I appreciate you revisiting your statement and it makes a lot of sense. Something I’ll be thinking about a lot more.
Good grief. Actual adult conversation and intellectual growth on the internet. It is sad that things have gotten so bad that this sort of exchange stands out, but FWIW you are both awesome.
I think the initial divergence in our thinking is how we define a person’s fair share. The U.S. has this pervasive myth that individual perseverance leads to achievement. That is, if you work hard enough then you can get rich and that’s the result of your own efforts. I’m not trying to discount the hard work that many people put into their success, but the reality is that they are benefiting from so many different things that they have no direct control over. The family you’re born into, the physical location where you’re born, your race/ethnicity, etc. These are all more significant contributors to success than individual effort.
A prosperous society supports all its citizenry in some way, but some people need a lot more support than others, and it’s through no fault of their own. People who are individually more prosperous should expect to contribute a proportionally greater amount to support society because they’ve already reaped the benefits of that society themselves.
My concern is the population is no longer growing. What happens when we have a bunch of retirees withdrawing and way less new people in the workforce to contribute?
The idea was that you basically paid your own way. A huge part of the issue is that Congress steals our social security money on a regular basis and people let them get away with it.
No, that’s absolutely not the idea behind Social Security. At all. It’s explicitly not that. The fact that people view it this way is exactly the problem.
You are not getting back the same money you put in. It’s not a retirement account, it’s a social safety net, and retirees are not the only people who receive (and rely on for survival) SS benefits. Many of them have never paid a dime into SS in their entire lives, and they still deserve that benefit.
A huge part of the issue is that Congress steals our social security money on a regular basis
My understanding is the raiding of SSA funds is a myth. The Old-Age and Survivor’s Insurance (OASI) trust fund simply isn’t keeping up with inflation (particularly the big inflation spikes, like in the 80s, and like now) and is paying out slightly more each year than it brings in, leaving it unable to pay full benefits by around 2034 or so. But it’s more than just inflation leading us to this result.
Every generation since the 70s has been getting poorer as the wealthiest siphon off more and more of the available money for themselves, leaving less getting paid into the fund by newer generations to help counter inflation. People who do make decent incomes currently also tend to stay in school longer than they did 50 years ago, and pay their way with loans rather than working some simple job, so they’re waiting longer to start paying into the system to begin with. All that plus average lifespans having increased since 1939 (though more recently it started dropping) means the SSA’s revenue has to either be increased by raising the social security tax, raising the cap on that tax, or both; or benefits have to be cut by increasing the retirement age or just paying out less to every beneficiary. That last one will happen automatically once it no longer has enough in the trust fund to pay the full amount, and the goal should be to avoid that. However, to my knowledge only an act of congress can increase the OASI trust fund’s income, absent an unforeseen economic boom.
I think most people should be willing to accept paying a little bit more in taxes so their parents or grandparents can keep getting their fixed incomes, but it often feels like a very loud portion of Americans are totally against all taxes and dig their heels in, refusing to pay one cent more to maintain something they like that in legal reality cannot be re-appropriated to something they don’t like, no matter how much we whinge about it being a ponzi scheme.
Hey, Americans below retirement age, you know how a chunk of your paycheck goes to Social Security? Vote Democrat if you want to ever see that money again. The Republicans don’t care about you in the slightest, and will gladly allow Social Security to collapse, and then you’ll get nothing and spend your twilight years starving on the street.
Think harder about elections, America. Think a lot harder. Your life literally depends on it.
And yet, senior citizens will vote in droves for any candidate who opposes this.
Even though it’s no skin off their behinds because they’re not working a job and getting paid taxable income. The mind boggles.
Well obviously. Why vote for social security, when instead you could vote against the gays? Easy choice!
Unfortunately, there is just too many of them. We probably won’t see any meaningful changes until the Boomer generation is gone; if the country as we know it can survive them.
Most of the “boomers” I know are actually Gen X.
Its not really a problem that you can wait out. And significant change is happening when people actively participate in the system rather than refusing because they think it won’t work.
Sure, they already got theirs. They know they’ll be dead before any meaningful changes would be made that affect them. “I got mine, good luck losers”
What it describes isn’t a “Wealth Tax” at all!
I get the feeling people are using the term wealth tax for anything that makes the wealthy pay more taxes.
It bugs me when clear specific terms get turned into uselessly ambiguous terms.
Raising the payroll cap has always been the sane, easy solution. The notion that after a certain point you make too much to be taxed is one of the most glaring examples of fucking the working class via regressive policy.
Ok so comparatively, this is like shoplifter versus a aerial killer
This isn’t a wealth tax, it’s a tweak to income tax.
The rich don’t gain wealth through income.
Capital gains should be taxed at least as hard as income.
Capital gains should be income, for tax purposes.
I agree. Politicians like to throw in the term “wealth” to create class division and evoke enough emotion to help push their agendas thru. Also, the 400k universal threshold doesn’t make a whole lot of sense…someone making 400k in Mississippi is much better off than someone making 400k in California. What’s considered a ‘fair share’ is hard to quantify, but definitely taxing capital gains equally is a good place to start.
