How about this compromise?

[kentuck]

We will extend the middle class taxcuts for up to $250K on one condition. The FICA taxes will now apply to wages up to $250K. Why should people making less than $106,000 pay more in taxes than someone making $250K and above? Would this help save the Social Security system? Or should we just remove the cap altogether??

[T Wolf]

1. Don't you dare suggest a real solution that appears fair. That is not the way this administration

and Congress roll.

They traded no unemployment extension for tax breaks for income above $250,000. That's the compromise and we should be happy with it.

[WI_DEM]

2. sounds fair to me.

[ProSense]

3. Good idea

and President Obama suggested it.

THE PRESIDENT: Yes. Here’s the situation with Social Security. It is actually true that Social Security is not in crisis the way our health care system is in crisis. I mean, when you think about the big entitlement programs, you've got Social Security, Medicare, Medicaid. These are the big programs that take up a huge portion of the federal budget. Social Security is in the best shape of any of these, because basically the cost of Social Security will just go up with ordinary inflation, whereas health care costs are going up much faster than inflation.

It is true that if we continue on the current path with Social Security, if we did nothing on Social Security, that at a certain point, in maybe 20 years or so, what would happen is that you start seeing less money coming into the payroll tax, because the population is getting older so you've got fewer workers, and more people are collecting Social Security so more money is going out, and so the trust fund starts dropping.

And if we did nothing, then somewhere around 2040 what would happen would be a lot of the young people who would start collecting Social Security around then would find that they only got 75 cents on every dollar that they thought they were going to get. Everybody with me so far?
All right. So slowly we're running out of money.

But the fixes that are required for Social Security are not huge, the way they are with Medicare. Medicare, that is a real problem. If we don't get a handle on it, it will bankrupt us. With Social Security, we could make adjustments to the payroll tax. For example -- I'll just give you one example -- right now, your Social Security -- your payroll tax is capped at $109,000. So what that means is, is that -- how many people -- I don't mean to pry into your business, but how many people here make less than $109,000 every year? (Laughter.) All right, this is a pretty rich audience -- a lot of people kept their hands down. (Laughter.) I'm impressed. (Laughter.)

No, look, what it means is basically for 95 percent of Americans, they pay -- every dollar you earn, you pay into the payroll tax. But think about that other 5 percent that's making more than $109,000 a year. Warren Buffett, he pays the payroll tax on the first $109,000 he makes, and then for the other $10 billion -- (laughter) -- he doesn't pay payroll tax.

So -- yes, somebody said, "What?" (Laughter.) Yes, that's right. That's the way it works.

So what we've said is, well, don't we -- doesn't it make sense to maybe have that payroll tax cut off at a higher level, or have people -- maybe you hold people harmless till they make $250,000 a year, but between $250,000 and a million or something, they start paying payroll tax again -- just to make sure that the fund overall is solvent.

So that would just be one example. That's not the only way of fixing it, but if you made a slight adjustment like that, then Social Security would be there well into the future and it would be fine. All right? (Applause.)

link

[Dawgs]

4. Recommend, but SS doesn't need to be saved right now.

How 'bout we do what you suggest and LOWER the retirement age. Let's make it better, not just keep it where it is currently.

[Igel]

5. Do we keep SS linked to contributions?

If so, then there'll be some pretty wealthy recipients of some large SS benefit checks.

If not, then they'll have altered one of the guiding principles of SS since its inception. At that point, it will just be another tax and benefit, not "insurance."