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To: GraceZ who wrote (159997)	10/25/2008 12:49:36 PM
From: neolib	Read Replies (1) \| Respond to of 306849

If you think the government is or can be run on SS surplus you aren't familiar with the budget. I never said anything about the government being able to run on the SS surplus. What is undeniable is that the government HAS been using the SS surplus to date. That is how they "forgot" IMO. If the government is going to use FICA income as part of the general pot, with only accounting entries noted to keep track of things, then why not simply make the accounting entries be some fraction of the general receipts and have the income taxation be part of the general tax pot as well? It is all smoke a mirrors anyway. 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. Nonsense. The effective tax rate at the low end would go down as it is already 15% higher than currently claimed (down to $ 1 BTW). 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 Why on earth are you trying to do the math with your draconian REALLY FLAT TAX idea? Keep the same graduated tax tables, but add the 15% FICA tax to the tables, top to bottom, and make an adjustment for the fact that FICA is BEFORE all deductions. There is no way this does not increase taxes, so then adjust the tax rates across the board DOWN to arrive at the same net tax. Hello, this will decrease tax at the low end, and increase it at the high end! Very simple. 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. You have a link for that, as I find the 5% of FICA not believable. An AGI of $46,000 is about 1/2 the FICA cap, so if this is also the median it should be at least 1/3 of FICA taxes ASSUMING all income is wage income. I suspect that a larger fraction of households with AGI BELOW the median income level obtain that income from wages, whereas a smaller fraction of the income > 46K comes from wages, so this would argue that the lower 1/2 pays more than 1/3 of the FICA taxes. So how do you get 5%??? This is what you are missing: FICA taxes have no effective deduction. If you have an AGI of $46K then you paid about $7.5K in tax just for FICA. If not, you aught to be in jail at some point.