Obama Plans a Massive Hike in Social Security Taxes

Punish the worker

250 K is not much in San Diego. This tax increase would raise my rates to over 50%. I will simply not work as hard or as long. I will buy less, tip less etc. Raising the rates will harm the economy

JOE of CA @ Jun 17, 2008 02:09:10 AM

The SS trust fund: More evidence of Govt. failure w/social programs.

"On Obama's SS tax proposal, I believe he is proposing (per the article) to exempt those making under $250K. "

Exactly, which is why my comments reflect his massive tax increase on those making over $250K. HARDLY trust fund billionaires!

"But they do need to so something to recoup the Trust Fund which cannot be repaid now from general revenue due to the past cuts since Reagan."

The Govt. of course SPENT the SS Trust fund which is a large part of the reason for SS's current dire straights. This is just more evidence of the Govt.'s total incompetence in running massive entitlement programs. SS is going broke, Medicare is in even worse shape. The Dems. response: MORE absolutely huge entitlement programs (socialized medicine, matching fed. retirement funds, etc.) when we can't begin to pay for the ones that we have. Absurd economic policy by an absurdly overpromising and stunningly unqualified Dem. presidential candidate with the leftist do-nothing congress in lock-step.

Taxed to much! of VA @ Jun 16, 2008 23:08:16 PM

Last post

Taxed Too Much of Va, we probably need to stop here, because the article is disappearing off the site page. On Obama's SS tax proposal, I believe he is proposing (per the article) to exempt those making under $250K.

I'm not so sure that he is correct in attacking SS problems by raising payroll taxes.

I would prefer raising certain income and (especially) cap gain taxes. But they do need to so something to recoup the Trust Fund which cannot be repaid now from general revenue due to the past cuts since Reagan.

Daniel David of NM @ Jun 16, 2008 18:52:10 PM

Response...

"As for Taxed to Much of VA, please note that I don't and didn't bring up Gates and Buffet as examples. But since you did, it's worth remembering that both of them are on record recommending more taxation at their highest end, not less. "

Daniel-

I didn't say that you brought up Gates and Buffett. In citing billionaire hedge fund managers while defending policies that severly punish those earning just $250K per year, you were employing the same tactic that the left always seems to use: They cite the very richest Americans while pushing to tax hikes on those earning over $250K. Obama and many others have invoked Gates', Buffetts', etc. names while pushing policies that will really hurt me and others who are just inside that top 1% and have worked very hard to get there.

As to Gates and Buffett, they are perhaps the two richest people in the world. Much of thier life is dedicated to giving thier money away, and good for them for doing so. Unfortunatley, much like Sorros, they have already made thier billions and it would mean nothing to them or to thier lives to pay higher taxes. It's infuriating when the truly ultra-wealthy, who could care less about paying more tax, push for massive tax increases on folks earning over $250 who WILL really feel these tax hikes. Just like Sorros, Buffett is sounding more socialist all the time. If he wants to tax billionaires let the legislative proposals reflect this. Same for the Hollywood leftists.

As to the taxes, I was saying that you already paid taxes on the intiial investment ($50 in your example). If you make money great, you can also loose a lot. Generally it takes risks to make money (unless it's in the form of Govt. handouts). A cap. gains tax of 15% seems reasonable. Your idea of haveing a higher cap. gains tax rate being used to offset earned income has a lot of merit as well. HOWEVER, as we all know, this will NEVER be proposed by the Dems. for higher earners. Even the ultra-liberal Wash. Post in a 4/25 editorial "Who'll Cover the Checks?" notes that Obama's completely unaffordable spending proposals of around ONE HALF TRILLION DOLLARS PER YEAR IN NEW SPENDING (our total fed. budget is $2.9T) is absurd. Any tax increases by Obama will be used on new spending, NOT to keep earned income taxes low. This level of spending by Obama will make today's deficit seem like the Good 'ol days! He impossibly overpromises on govt. handouts to buy votes from people who just want more free govt. stuff at other people's expense.

Finally, your response to my posts dealt only with cap gains tax and the Gate's/Buffett issue. These were the LEAST significant issues which I discussed in my responses to your posts. What about the rest? Obama calles his latest handout (to offset SS taxes) "Making Work Pay". Of course, to fund this new handout, he has to impose a "Making Work Not Worth It" plan on those of us who've worked our tails off to finally earn a good living.

Taxed Too Much!!!!!!!!!!! of VA @ Jun 16, 2008 14:03:57 PM

Obama's slush fund funding plan

It sounds noble to "save" social security, but the real "crisis" Obama is trying to stave off is the depletion of the politicians giant slush fund (a.k.a the Social Security "Surplus"). Social Security will be cash flow positive for the next 10 years. After that pols won't have billions of "surplus" to throw around on discretionary spending. Here's my Social Security plan: Each year the plan is out of balance according to the actuaries just raise the retirement age by one month, and freeze COLAs for existing retirees.

Obama's plan is not about helping Social Security, it's about saving the politicians' giant multi-billion dollar slush fund.

masstexodus of TX @ Jun 16, 2008 13:37:53 PM

Let all the "believers" freely give as much of "their" money to an "Obama Fund" so "they" can feel good about helping these poor "lazy ass" people. Living in the "Land of the Free" and having the choice to do what the hell I want to with "my" money, I will if I want give to the charity of "my" choice.

Tony of NV @ Jun 16, 2008 12:04:31 PM

Going on

Mercy, there is a lot here. Starting with Andrew on "privatizing" Social Security. The first reason we don't want to do that is "privatized" means a certain portion goes wasted on investment-house custodians to "manage" each accout for decades. They're salivating for the opportunity to take a percentage cut of the assets in the national pension plan each year forever, with all RISK to be retained by citizens. The second reason is that at retirement a pot of money must be converted to lifetime income. This involves private annuities or "betmaking" on life expectancy and future interest rates. Insurance companies are standing by salivating as well at the prospect of an opportunity to take an underwriting cut on every person retiring forever. CHECK SOME PRESENT-DAY ANNUITY RATES AND DEALS AND PREPARE TO BE SHOCKED. The conversion to lifetime income part of "privatizing" is an enormous rathole that citizens must have sense enough to avoid. The third reason you do not want to "privatize" is the waste of cost for competitive marketing of companies doing both money management and annuities. (Think AFLAC duck and GEICO gecko.)

As for Taxed to Much of VA, please note that I don't and didn't bring up Gates and Buffet as examples. But since you did, it's worth remembering that both of them are on record recommending more taxation at their highest end, not less.

As for your assertion that capital gains come from money that one has already paid taxes on when it was earned, and that the capital gains tax is some kind of double taxation, please clarify. If you buy a stock at $50 and sell it a lear later at $100, you make $50 and pay $7.50 tax (15% on the gain). You don't at all pay any double tax on anything. You had $50 and now you have $92.50----heckuva deal compared to your harder and more heavily taxed work as a doctor.

Given that the $50 gain on the stock, by the way, comes from either the lost opportunity of others to profit on it (because you were smarter and bought it first), or worse, from somebody who paid the $100 price just as the stock is about to decline to say $80---so your gain comes in part from someone else's direct loss. This is what I mean when I say gains are coming from elsewhere in society, not from thin air. It's entirely appropriate for government to be both extracting a portion of those gains to fund government operations that ARE required (even though we gripe about them as "redistribution)) and it is appropriate for a much higher cap gains rate to perhaps discourage boom-bust speculation in the first place. If cap gains tax was the same rate , for instance, as earned income tax, it's possible the stock might not have been bid past $80 to begin with---generating less gain to be taxed, and less losses for the last ones jumping on a bubble-stock.. MORE IMPORTANTLY, it's possible that much higher cap gain rates might enable lower rates on earned income. I believe this is where Democrats ought to focus.

Daniel David of NM @ Jun 16, 2008 11:46:30 AM

IRS audits in CA

"I do taxes for a living it is only the first 89,000 that you pay social security and medicare taxes on so I have no idea what he is talking about." Donna of CA

Don't hire Donna to do your taxes....you pay Medicare on the entire amount and 12.4% on the first $102, 000 of income in 2008...

eLet's not forget the mount of tax that will hit employers...lastly, raising taxes is counter productive, historically regardless of the tax rate the governement takes in about 19% of GDP, we need to figure out how to raise GDP

Lastly can it with all the hyperbole, high income earners are not all weatlhy...you pay taxes on income not wealth

DBH of IL @ Jun 16, 2008 10:45:33 AM