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Baby Boomers: Repent Partisan Politics Or Bend Over for Uncle Sam
Corporate lawyer FDR won the presidency four times with Animal Farm politics.
Today, the combined Social Security and Medicare Federal Insurance Contributions Act tax is a 15.2% regressive tax.
FICA is based on wages earned and paid, half by employee and half by employer. If the employer did not have to pay FICA, he could pay higher wages and benefits. Thus FICA keeps wages and benefits down.
http://en.wikipedia.org/wiki/Federal_Insurance_Contributions_Act_tax
The taxable Social Security Wage Base, currently $106,800, grew faster than the cost of living.
Excess FICA contributions due to more than one employer are not refundable to the employer.
http://en.wikipedia.org/wiki/Social_Security_Wage_Base
If the 15.2% Tax Social Security Trust were actuarially sound, like a privately regulated business or even like the privatized Australian, British, Chilean or Swedish pensions that outperformed the 2% Social Security Trust two or three times, there might be no problem begging for Medicare and Social Security reform.
In fact, three counties in Texas opted out of Social Security and enjoyed retirement income benefits compounding at 4% or 7% versus the 2% of Social Security.
http://www.mackinac.org/article.aspx?ID=1494&print=yes
Until 1984, Congress had a better pension plan that exempted Congress from Social Security. Since 1984, Congress pays Social Security Taxes and kept their better plan allowing them to retire with income benefits close to their working income.
http://www.factcheck.org/askfactcheck/do_members_of_congress_pay_social_security.html
February 9th, 2010 at 3:28 pm
USA Today just quoted Stephen Goss, chief actuary for the Social Security Administration:
“Things are a little bit worse than had been expected,” he said, “Clearly, we’re going to be negative for a year or two.”
Seems declining mandatory FICA payroll taxes, earlier retirements and 10% disability brought the day of reckoning 7 years earlier than expected.
Hint: This is not inflationary, but default-driven deflation…
Aloha Regards*Rich