That's what those "life cycle" funds are for. Just put people into something like that, with a low administrative fee, as the default option. Limit it to index funds; if people want to invest in individual stocks, they can do that outside their retirement account. I can see SS getting mostly phased out in the extremely long term. It would need to be kept as a legacy for those too old to have put much into the 401(k) thing, and then there will always be individuals who are simply not able to work a regular job. OK, a quick google turned up a 5 year old census report that showed about 12.5% of Americans make over $120,000. Hit 1/8 of Americans with a huge tax increase (6.2% right off the top) to benefit a program from which they will never benefit, and you have instantly made a whole lot of new republicans. You sure that's a good idea for progressives to pursue? The mandatory 401(k) type plan is a much easier thing to sell, since you do get to keep the money you put in.
Again, just to clarify, the Social Security tax is 12.4%, not 6.2%, so that huge tax increase is twice as big as you are projecting.
Half of the 12.4% is employee & half is employer. Plus 1.45% of all earnings added on top for Medicare. There was an increase in the TWB for 2017 but no raise in 2016. The maximum amount of earnings subject to the Social Security payroll tax will climb 7.3 percent in 2017 to $127,200—up by $8,700 from the $118,500 maximum for 2016 and 2015,the Social Security Administration (SSA) announced on Oct. 18. Of the estimated 173 million workers who will pay Social Security taxes in 2017, about 12 million will pay more because of the increase in the taxable-maximum amount. This adjustment, which takes effect Jan. 1, is based on the government's estimate of real wage growth in the recent past. The 2017 jump in the taxable-earnings cap is the largest one-year increase since 1983, in part because federal law kept the taxable maximum unchanged for 2016 due to a lack of cost-of-living increase in Social Security benefits. Social Security is financed by a 12.4 percent tax on wages up to the taxable-earnings cap, with half (6.2 percent) paid by workers and the other half paid by employers. This taxable wage base usually goes up each year—it rose from $117,000 in 2014 to $118,500 in 2015, but stayed put at that level for 2016. https://www.shrm.org/resourcesandtools/hr-topics/compensation/pages/fica-social-security-tax-2017.aspx
Yes but the employer pays half, so the 1/8th funkfoot is talking about will only see the 6.2% increase. Obviously this ignores the extra expense that business owners will now have to take when they have to pay into S.S. for those people, sure it is tax deductible, but it is still an extra expense.
<sigh> Tell that to the self-employed, who are probably make up a majority of that 12.5% of funkfoot's demographic. And it hardly matters who pays the tax, it is still a 12.4% tax Here is a question, anyone know why the employer pays half to tax and the employee the other?
Because we prefer to burden our nation's employers with our society's costs than to spend the same money on taxes with a better roi.
I do know at least 2 self employed that do not pay into Social security, I have told them that it will catch up to them someday, but they don't listen.
Cept you didn't say that: Again, just to clarify, the Social Security tax is 12.4%, not 6.2%, so that huge tax increase is twice as big as you are projecting.
Cept I did... I noted that the tax was 12.4% not 6.2%. And earlier I noted that the income cap was $127,200 not $105,000. Anyway, the important thing to note is the SS tax is 12.4% regardless of who pays. Employers don't care, they look at total cost when hiring employees, and tax is simply part of the cost of an employee. They could easily give people a 6.2% if the employee paid the full tax and the effect on their bottom line would not change.
https://www.washingtonpost.com/news...-we-thought/?tid=sm_tw&utm_term=.192e9e1858f2 Austerity didn't work.
You understate it. It was a disaster. Not that we didn't know about it but we need to call that policy for what it is: A DISASTER. We now take a break from your regularly scheduled scandals to bring you some not-so-breaking news: austerity was as big a disaster as its biggest critics said it was. That, at least, is what economists Christopher House and Linda Tesar of the University of Michigan and Christïan Proebsting of the École Polytechnique Fédérale de Lausanne found when they looked at Europe's budget-cutting experience the last eight years. It turns out that cutting spending right after the worst crisis in 80 years only led to a lower gross domestic product and, in the most extreme cases, higher debt-to-GDP ratios. That's right: trying to reduce debt levels sometimes increased debt burdens.
Because of the conservative bias in the MSM on economic matters, we have to work very hard to continually get the truth out there. Except for the First Bush, when you raise taxes, revenue goes up, and when you lower taxes, revenue goes down.
I suppose that's one way to look at a graph which mostly shows that overarching economic conditions are more influential on nominal-dollar receipts than nominal tax rate changes. Particularly in the Obama case, the slope of the line through the shaded area is nearly identical with the slope of the line in the preceding 2+ years. And of course the Bush I increase "had a different effect" than the Clinton increase, which saw a similar mostly-unchanged slope before and after. Not shown on here is anything like a constant-dollar comparison, instead opting (oddly) for a nominal dollar picture for a time period exceeding three-and-a-half decades. Nor does it grapple with what these revenues are as a percentage of the economy, which surely was not constant for 35+ years.
1. It says that nowhere. 2. Even if that's true, the graph is still useless, and it gives no idea of the receipts relative to the size of the economy. 3. The other criticisms - which are more important viz. your reason for posting - stand. I get that it tickled the dopamine receptors that fire when someone says something you agree with, but this is pretty stupid. I wish I could say I was disappointed in you, but I expect this from you. I'm more disappointed in Mother Jones for being very, very sloppy.
The fact that economic growth rates have big effects on government revenue doesn't prevent us from observing the effects of tax rate changes as well. What do you think the first word on the chart's title means?