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Politics : Ask Michael Burke
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To: James R. Barrett who started this subject11/9/2000 8:52:11 AM
From: gnuman   of 132070
 
Tax Cut Proposal
When SS expenditures start to exceed income, the Government will have to raise General taxes to meet it's obligation of "The full faith and credit of the U. S. Government" on the "Special Issue" securities held in the Trust Fund. (Until that time the Government will spend the SS surplus on other programs).

In the meantime, the politicians are promising tax cuts.

So why not do this?
Reduce the SS tax rate such that SS income equals expenditures. That will have the immediate effect of reducing "taxes" ~$200B/yr, (and growing).
I see a number of advantages to this proposal.
It would reduce taxes on those who need it most. (Those with incomes less than $80K/yr, the current maximum income subject to the SS tax).
The government would be forced to live within the General budget since the "surplus" would no longer be available in the General Fund. (And if they want to live outside the budget they would have to raise General taxes, not a very popular option).

For those who cry out this would hasten the bankruptcy of the SS system, I would claim the current system only delays bankruptcy till the next generation. In fact, using the surpluses for other programs magnifies the potential obligations of future generations. Will they be content to back these obligations with "the full faith and credit of the U. S. Government"?

For forty years Mom and Pop have been putting a little aside in the cookie jar for the day they retire. When they find out the money in the jar has been replaced with IOU's, they'll scream bloody murder.

JMHO's
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