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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: neolib who wrote (159906)	10/24/2008 9:15:24 PM
From: bentway	Read Replies (1) \| Respond to of 306849

Yes, Grace defending our private insurers as any sort of a retirement solution at this point in time just shows she'll follow her Ayn Rand crapola into the grave.

To: neolib who wrote (159906)	10/25/2008 12:24:43 PM
From: GraceZ	Read Replies (2) \| Respond to of 306849

Err...unfortunately, the government forgot this first If you think the government is or can be run on SS surplus you aren't familiar with the budget. The surplus is small getting smaller until the required benefits payments will swallow the entire budget. Uh?? Who cares? It treats both wage income and investment income the same way. Heck, tax SS income as well! What you are failing to understand is that any such scheme must also reset the tax rates lower because the base expands. Expanding the tax base would require the lower half to pay much higher taxes no matter what you called those taxes. It isn't possible mathematically let alone politically feasible. If we do a unified budget, and add both outlays for the general budget to the SS/Medicare budget we get outlays in 2008 of 2724 with revs of 2485. So we borrow 239 billion in 2008. Now let's divide the revs by the est 120 million households, that gives us $22,700 per household. Well I can tell you now there is no way you can get $22,700 per year out of a retired household pulling in $800/month in SS payments (from which Medicare premiums are already deducted) so I doubt you really meant to expand the tax base downward that far! Right now the bottom half of all households, those with an AGI $46,000 or less, pay around 4% of all Federal taxes and 5% of FICA. That is an average of $1660 per household in the bottom. The bottom quintile pays nothing because they have almost nothing to pay (no one would pass a measure that left the bottom with not enough left to eat) so the second and half of that middle quint covers the whole amount at $3200 per household combined taxes (both FICA and Federal heavily weighed towards FICA). Now let's look at the top, AGI for households above 43,000. They pay on average 39,600. Well you know that doesn't come out of the middle quint, it comes mostly from the top quint with the middle and fourth paying only around a fifth to a third of that amount. So where do you want to spread the base? You couldn't possible mean spread it down because there isn't enough money there to make a significant difference. The reason the tax remedies always go after the top quint is because there is no way the households in the middle or bottom can pay anything even remotely near an equal share of what the government spends.