Strengthening Constitutional Self-Government

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Economy

A Grand Bargain?

Although the government pretends otherwise, Social Security and Medicare are, in fact, welfare programs.  There is no relation to today's payroll tax payments and tomorrow's benefits.   In fact, we simply pay current benefits out of today's taxes.
 
That gives me an idea.  Conservatives sometimes note that roughly 50% of Americans don't pay income tax.  The Left replies by pointing to the payroll tax.  If we classify it honestly, as a transfer payment, that is correct.  

The only way to end the myth that social security and medicare are pensions is to kill the payroll tax.  There's nothing left to cut in the income tax for close to a majority of Americans, if memory serves.  Including the payroll tax in that calculation would change that.  By eliminating the payroll tax, and rolling it all into the income tax we find a way working class Americans and, at the same time, create a more honest and transparent tax policy.  That would also set up a major change in federal old age benefits that would help with the long-term deficit.  It would make a convenient time to means-test benefits.  Why should wealthy people get transfer payments.  As a result, we could get a more "progressive" tax system and system of federal hand-outs, and, at the same time, we eliminate the myth that our old age hand-outs are, in any sense, pensions.

Categories > Economy

Discussions - 1 Comment

I agree, but this will never happen. No one, on the Right or the Left, who depends on Federal employment would ever do such a thing. Too bad.

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