"IMF, dirty MF, takes away everything it can get" From my favorite rock song about the International Monetary Fund, written by Bruce Cockburn.
You do realize both the left and the right passed by-partisan reform in 1983 to save Social Security into perpetuity, right? And then 20 years later we found ourselves in the same situation, and today it is a bigger mess. I understand you don't care because you are old and you benefits won't be cut, but I think we owe the next generation of Social Security recipients a better answer.
This part is not true. 1. Reagan enacted a massive tax cut, mostly on those who "supply" capital. 2. This was supposed to create a massive expansion in our economy, so that the tax cuts paid for themselves. 3. They did not because supply side economics is a stupid theory. 4. We had a huge deficit. 5. Bothsides got together to "save" SS. The plan was to have SS run a surplus while the boomers were all earning, with the money going into a trust fund that would pay boomers their SS when the time came. We enacted a regressive SS tax increase to make up for the regressive supply side cuts. 6. When the time came to pay the piper, Bush II slashed taxes. It's a little more complicated than that, but that's the gist of it.
Dave, as always you are such a blind revisionist when it comes to history. The Social Security Reform Act of 1983 cut benefits and raised the FICA tax. Both sides said it "saved Social Security" when in reality it simply kicked the can down the road. You can spin it however you like, but you will still be lying.
Yes, but the grand bargain was not that grand for working people. Yes, because St. Reagan began to borrow heavily from the Social Security Trust Fund. We do and there are two simple fixes: 1) Remove the cap on contributions. 2) Anyone who uses capital gains as more than "X" percentage of their annual income (I would put it at 1%, but 33-50% is more likely) has to pay into Social Security to the amount that they use Social Security as "income." Agreed (I took out the personal snark).
It was Johnson that started robbing the "Trust fund". A couple points here: 1. You can remove the cap on contributions and the system still in running a huge deficit. 2. Your solution has just changed the fundamental principles of the program. You sure you want to go there?
It was Johnson who first put Social Security "on budget" (and subject to taking). Reagan began the wholesale borrowing. 1. It would go quite a long way to plugging the holes. It should have been done all along. 2. Yes, yes I do want to go there. I think everyone who is earning income should pay into the system.
Everyone earning an income does pay into the system. Me thinks you don't understand how the system works.
Now you're just being silly. Long term capital gains taxes max out at 20% for someone who contributes nothing to society and simply sucks the blood out of the corpse of late stage capitalism. But I pay 32% on my hard-earned labor. As always, if we simply tax everybody's money at the same rate, all the budgetary problems magically disappear.
That is simply not true. First, your qualifier "earning an income" disqualifies all people who may have great wealth, but not from "earning an income" in the traditional sense (inheritance, receiving funds from a trust, etc.). Second, certain people are exempt. For example, no Social Security is deducted from my teaching pay, due to my paying into the "teacher's pension." I am not in favor of that and I have requested to have Social Security deducted. Since I currently teach as an adjunct, it really does not have much of an effect on me, but I want the Social Security deducted. People who have "Religious exemptions" do not pay into Social Security. Here is an old article (December, 2019) that provides an explanation. https://smartasset.com/retirement/exempt-from-social-security-taxes Of course, people who work "for cash" do not pay into Social Security, but, legally, they are not allowed to work "for cash" and should be filing taxes and paying taxes and Social Security.
Except that with very few exceptions, most people who buy and sell their home, their stocks, bonds, investments etc. are not "people who contribute nothing to society and simply suck the blood out of the corpse of late stage capitalism", as you so eloquently put it. In fact, the vast majority are mostly regular folk who hard work every day just like you and I do. Having to pay higher taxes and Social Security on capital gains will hurt regular folk. Often those who have to sell their home and other investments have to do so precisely because they are going through tough times and need to make adjustments in their life. (Job loss, divorce, trying to avoid bankruptcy, death of a loved one etc.) If you are suggesting raising taxes and charging social security on capital gains as a mean to punitively punish "the 1 percent", you should realize that it will mostly adversely affect "the other 99 percent". There are good reasons why countries that in other ways have more progressive and "socialist" policies than the US have lower capital gains tax rates.
Defining it as just those that have an Income is incorrect, there are a few jobs or exceptions on employee, self employed income so they do not pay Payroll taxes. As xtomx explains below, there are religious exceptions, and some foreign dignitaries also are except. But only income based on employment is taxed with social security, passive income is not. This could include on top of what Xtomx described above, rental property income, Dividend income, Loan interest income, ect. There is a good reason on why passive income on savings or investments is not taxed as employee tax to fund an employee based insurance program. Obviously we are a democracy and we can elect people that can make changes and ignore or decide that those reasons should not apply any longer.
That's fair, of course. You could even argue that was true of stocks and bonds in some cases. But the people who live off their dad's stock dividends pay ridiculously low rates compared to what I, an honest workingman, pay. It's class warfare, there's no other way to describe it.
This is why democrat talking point is we will only tax those making above X amount, they know that taxing the other is more popular than taxing the all.
By this definition, 401K programs are class warfare and retirement programs that invest in the stock market to get better returns for their pensioners are also class warfare. I want to tax capital gains and dividend income with payroll taxes, but calling it class warfare is a bullshit talking point.
True, but those are the few exceptions to the rule that I mentioned. The majority of people are faced with capital gains when we sell the few assets we have, and most of us sell our few assets because of changes in our lives, often negative changes. Even inheritances, for most of us are relatively modest, and come as a small consolation that might help us as we get through a time of the grieving, unexpected expenses and additional work that result from the death of loved ones.
Yeah, the problem is that "taxing the other" is far from being enough to pay for what some of them are promising. And this is true even without taking into account the fact that there is a point in the curve at which "overtaxing the other" starts having negative consequences for the economy.
I am not sure about state (as in the state of California for example) law, but for federal inheritance tax kicks in at 11 million as of last year (way too high IMO), and funeral expenses can be deducted from the state when they file the last income return. So if it is "modest", you won't pay federal tax and if the state is leaving behind more than 11 million, then depending on how fancy the funeral you want to have for your loved one, there should be some left over to divide among the family. It is worse for people that do not get any inheritance from a deceased family member and still have to pay for funeral expenses, those are not tax deductible, you can bill the state of the deceased, maybe you can get some money back from that. https://finance.zacks.com/can-funeral-expense-deduction-taxes-6936.html