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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: Road Walker who wrote (327077)	2/22/2007 4:37:31 PM
From: TimF	Read Replies (1) \| Respond to of 1574097

Or would you support raising income taxes to make up for a future SS shortfall? Income taxes will pay for future SS shortfalls. Right now SS is in "surplus", the dedicated tax brings in more income than SS spends. The extra proceeds go in to government bonds, that are called a trust fund, even if that label is mostly just another useful fiction. The bonds are not fake, and they presumably will get paid back. In that sense the trust fund isn't a fiction, but they will be paid back from the federal government to the federal government. Its just shifting around cash and IOUs from one pocket to another. Currently SS tax receipts are used to pay for spending by other areas of the government such as the Army, the Treasury department, and potentially Alaskan "bridges to nowhere". When SS starts to spend more than the SS tax brings in the difference will be paid for from the income tax ("paying back" the loans from the "trust fund"). So the extent that the SS tax is really dedicated, and SS spending only comes from that tax is exaggerated. But even if it was 100% dedicated, it would still be federal tax income, and federal spending. You could create any sort of dedicated taxes tied to whatever spending area you want and other then creating some extra bureaucracy, maybe some extra political difficulty in cutting or eliminating some program, and probably some greater inflexibility in the budget, the net effect is not significant. You say, correctly, that defense is not in surplus, but neither is social security spending. Social security taxes, are separate from the spending, and they have no intrinsic tie. Right now they are tied by law (but that tie isn't total as I noted above), but a simple act of congress could eliminate either part without eliminating the other. Also a single act of congress could make defense something that is in "surplus" in the same way that you call social security something that is in surplus. Just designate a portion of the income tax to defense, or reduce the income tax while instituting a new defense tax. All the sudden (depending on the tax rates) you could say "defense is in surplus" but it would be a useless statement. The federal budget would still be in deficit, defence spending would still consume the same resources that it does now. There would be very little change in the real world, only in the labels you apply. Its not just defense, you could create dedicated taxes for the national parks, or for the department of commerce, or for the FBI. None of these taxes would however change the burden that the spending for these programs places on the federal budget and on the country's economy. There is nothing ideological about this, I'm just pointing out simple facts. I could take these facts and later use them as part of some ideological or political argument, but they are not themselves artifacts of ideology.