Did I hear Thom Hartmann say that if no cap on SS payroll tax that payouts could be upped by 50%?

[Dawgs]

Meaning, everyone would be covered forever and retirees could get 150% of what they are getting now.

No? I thought I heard it on Fridays show.

[hansberrym]

1. Do you have a link? When something sounds too good to be true...

The only way that could work is if the cap were raised on contributions, but not on benefits.

Hell, any "system" will "work" if you force someone else to pay the bill, but is that really what SS is supposed to be?

[BeFree]

2. Social Security is an equalizer

Not a balanced equalizer. Not yet.

If the cap were raised on contributions, I'd bet the minimum wage earner would have none of its meager wages deducted.

[Dawgs]

7. Here's a link to something that sounds like it. But this idea mentions DOUBLING payouts.

http://www.thomhartman.com/blog/2010/08/dont-take-away-social-security-double-it-instead

and a link to the study...
http://newamerica.net/sites/newamerica.net/files/policydocs/Hill%20-%20Social%20Security%20-%2013-Aug-10%20-%20spaced%20graphs.pdf

[hansberrym]

9. Thanks for the link, that's what I thought.

Hill calls for raising the cap on contributions while freezing the benefits to the person paying the contribution above the current level. Sure, others will have their benefit increased, but someone contributing on income above the current cap will not see any return on that money. Oboma's donht hole approach has a more populist feel, because it only screws the truly rich and not people making slightly more than the cap, but it still destroys the underpinning of SS system which is that SS is mandated insurance rather than a simple forced transfer of money.


As in my earlier post, what is described by Hill towards the end of the article is not a fix to the "system" anymore than simply taking money from the general fund without repaying it would be fix to the SS system. Instead it is an admission that the system can not sustain itself.


The article is hardhitting in many ways, though in my opinion simply papers over the main issue. Corporations are behind in their payments to pensions and so many private plans are underfunded. Also state and local government pensions are underfunded. We are simply kidding ourselves if we combine all these pension/retirement benefit systems into one basket to be controlled by the federal governemnt. Social security may be very popular, but it is not well managed as evidenced by the need to resort to taking contributions for which there will be by design no benefit paid -that is no longer mandated insurance, but mandated donation.

The way things are now, risk to retirement benefits is spread among individuals, corporations, local, state, and federal governemnts. Hill proposes that this risk be shouldered to a far greater extent by the Federal government but offers no compelling reason to believe that the federal gov will not screw up this proposed expaned SS program, just as it has screwed up the current SS program, or as many individuals have screwed up their retirement savings, or as many state and local governments have managed to underfund their pension liabilites.


Don't put all your (or even most of) your retirement eggs in one basket!

[Skink]

3. this would be a true form of stimulus.

[Gold Metal Flake]

4. Go to the website.

http://www.thomhartmann.com/

Check the message board. Join and ask if you do not see it. Try the podcasts. Unfortunately you are much more likely to get an erroneous or falsified response to your question here.

[Pirate Smile]

5. Obama said a long time ago that Social Security is easy to fix and isn't really a problem.

Just raise the cap or do a donut-hole and have people making more then $300k or $500K pay SS tax on the $ they make above that rate. He said that in response to a question at a town hall last year. He would always make the point that Warren Buffet's secretary pays SS tax on all of her income but Warren pays it only up to $106,800. Either have the ss tax keep going or donut-hole it and the problem is solved. There really isn't a problem.

[BeFree]

6. I like it. Make it so.

I mean, like, why not? Problem solved, and lots of little old ladies are allowed to live comfortably for their last few years.

[RC]

8. The real problem with Social Security that everyone is dancing around is

that our living wage jobs have been out sourced over seas. The people that had those jobs are still here, either unemployed or working for far less than before.

Get our living wage jobs back into this country and the problem is solved.

Anything else is just diddling with the symptoms yet again.

[BlueCheese]

10. The reason Social Security is so popular...

... is that it is specifically not a welfare program. It is a social insurance program, in which what you get out depends on what you put in. If it becomes a program in which some people are subsidizing others, it will quickly lose a lot of its popularity and end up like welfare or Medicaid. Thus while payroll taxes are capped, so are benefits. I'd oppose any attempt to uncap one without the other.

However, this means that the Social Security trust fund is a sacred promise. For decades, the middle and working classes have been subjected to the regressive payroll tax with the promise that the payroll tax is for Social Security only. It's true that the rest of the government has been borrowing from the trust fund to pay for other things. Every cent of that must be paid back to Social Security. Any attempt to get out of this will mean that the trust fund and the payroll tax was nothing but a big lie, in which people were duped into accepting a regressive tax with false promises about their retirement. That would be unconscionable.