Tuesday, January 22, 2008

Same ole, same ole on Social Security

I was never a big Fred Thompson fan - he seemed a reluctant campaigner - but at least the guy had the courage to put forward a workable plan to reform Social Security. By contrast, the Democrats fall back on their same tired, pandering tropes:

EDWARDS: But I do have to say, in response to something Senator Clinton said just a minute ago, both Senator Obama and I have said Social Security needs a solution. And we have said we won't privatize, we won't cut benefits, we won't raise the retirement age. Same thing that Hillary has said.
So they won't cut back benefits (Florida's next after South Carolina!), they won't raise the retirement age even though Americans are living much longer and healthier lives, and they won't allow Americans to opt out of a system that is going bankrupt. Golly, I wonder what remedies haven't been discussed.

But she has proposed nothing about how we're going to create revenue to keep Social Security alive and talked about fiscal responsibility.
Exactly!

Here's the problem: If you don't have -- this is not complicated. The American people understand it. If you've got more money going out than is coming in, you're going to eventually run out of money.
Go, man, go!

And you've got to have a way to pay for it, which is why -- now, let me finish this. Lord knows you let them go on forever.
Do continue.

What I'm saying is we have to be consistent in what we're saying. I have said I think Hillary doesn't want to talk about raising taxes. Let's just be honest about that.
Doesn't want to talk about it, but it's the only option left on the table unless we're talking about the automatic cut in Social Security benefits, as dictated by current law.

Barack and I have both said that you've got to do something about the cap on Social Security taxes, which is now capped at $97,000. It means if somebody is making $80,000 a year, every dime of their income is taxed for Social Security. But if you are making $50 million a year, only the first $97,000 is taxed.
That's not right. And people ought to be paying their Social Security taxes. But the American people deserve to know what we're going to do.
Oh, Lord, here we go again. "People ought to be paying their Social Security taxes" - as if they had a choice! I have a quick question for son-of-a-mill-worker John Edwards and everybody else looking for the quick fix (i.e. "let somebody else pay"). Social Security has always been a universal program in which American workers put into the system a portion of their income in exchange for a proportional payment after retirement. But Franklin Delano Roosevelt knew that it was a political loser to have million-dollar checks going out to John D. Rockefeller, so he structured the program with an income cap that is indexed every year with inflation.

Are the Democrats saying that people making $50 million a year should pay the full 12.4% payroll tax on that income? If so, do they support a proportional payment upon retirement? Or do they intend to turn Social Security into a new welfare program and destroy the program's universality?

Boy, it pains me to say this, but Hillary's reticence on this question is looking better than Edwards and Obama's silly, Depression-era populism.

2 comments:

Bill Woessner said...

Are the Democrats saying that people making $50 million a year should pay the full 12.4% payroll tax on that income? If so, do they support a proportional payment upon retirement?

Of course not. Why treat everyone the same? It's far better politically to pander to voters.

SR said...

When John Edwards was running in 2004, I came across info about his FICA payments in his big earnings years as a lawyer (maybe from the Wall Street Journal?). Seems that since the Medicare portion has no cap, he ran his salary through a corporation then took the remainder as dividends to lower his Medicare contribution cost. As of 2004 this was dubiously legal, as it had not been tested in the courts.

Taxes for thee, but not for me.