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Morning Joe is prattling on about Austerity, aka Shared Sacrifice ... Simpson Bowles.

Scarborough is stating without facts or reason, that "raising taxes on the rich" will not fix Social Security.


Those with a bit more economic depth, might disagree with Mr. Scarborough:


The Only Social Security Reform Worth Considering: Raising the Ceiling on Income Subject to It

by Robert Reich, robertreich.org -- July 22, 2011

[...]
Social Security isn’t responsible for the federal deficit. Just the opposite. Until last year Social Security took in more payroll taxes than it paid out in benefits. It lent the surpluses to the rest of the government.
[...]

Greenspan’s commission must have failed to predict something. What?

Inequality.

Remember, the Social Security payroll tax applies only to earnings up to a certain ceiling. (That ceiling is now $106,800.) The ceiling rises every year according to a formula roughly matching inflation.

Back in 1983, the ceiling was set so the Social Security payroll tax would hit 90 percent of all wages covered by Social Security. That 90 percent figure was built into the Greenspan Commission’s fixes. The Commission assumed that, as the ceiling rose with inflation, the Social Security payroll tax would continue to hit 90 percent of total income.

Today, though, the Social Security payroll tax hits only about 84 percent of total income.
[...]


Instead of railing against the Democratic Party Joe, how about trying a little Math.


Simply tie the FICA Ceiling level to Inflation and to the ever increasing rate of Income Inequality -- and you're so-called "problem" is gone, Joe. Just ask Alan Greenspan -- that was the "solution" he prescribed (Ceiling = 90% of ALL wages), from back in your day -- when "cooperation and big ideas" ruled the congressional roost.



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Originally posted to Digging up those Facts ... for over 8 years. on Mon Oct 01, 2012 at 05:53 AM PDT.

Also republished by Income Inequality Kos.

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