New Youk Times Social Security Plan
Posted on October 19th, 2004 in General, Social Security by tavaresforby ||
To be honest, when I first say this article, I thought it was a joke. The New York Times developed a plan to address the Social Security dept. This would be the only plan if the US stay with the current social security program.
- Means-test benefits Change the benefit formula so higher-income workers get lower returns on their earnings. This would be accomplished by reducing benefits per dollar of earnings from 15 cents to 10 cents on the top bracket of earnings over the next 25 years.
- Raise the Payroll Tax Cap Social Security taxes are not collected on earnings above $87,900. This plan would increase the wage base over the next 40 years, so the amount of wages above the cap drops from 15 percent to 10 percent of wages.
- Tax Wages Above the Tax Cap Add an additional tax of 3 to 4 percent on wages above the cap.
- Raise taxes/Reduce Benefits Based on Changes in Life Expectancy Projected costs of increased life expectancy should be updated regularly, and the responsibility for them should be split between retirees and workers through small automatic benefit reductions and tax increases on workers. By 2036, the tax rate would be 12.7, up from 12.4; benefits would be cut by $300 a year.
- Tax Increase on Workers Increase Social Security payroll taxes by an additional 0.2 percent a year.
- Bring in New Taxpayers Include the four million state and local government employees who are currently exempt from Social Security.
As you can see, the only way to save the current social security program is to either raise taxes and/or cut benefits. If social security can be privatize, all this can be eliminated. No raising taxes, no cutting benefits, and a higher percent rate return on your invested money.
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