Originally posted by: LEDominator
Originally posted by: BaliBabyDoc
FICA is the TAX that comes out of your earned salary to pay for SS and Medicare. I forget what it actually stands for . . . but its probably the law that authorized it.
I got that part of it, but are you for it or against it or what? I didn't really get what you were trying to say about it.
It's a tax. It's a tax that everybody pays but the benefits accrue moreso to the well-off despite the fact they only contribute for part of their income. The cutoff is based on actuarial tables but those tables don't factor in the early death's of the middle/lower income brackets and the longer lifespans of the well-off.
When people parade stats about how the lower/middle income cohort don't pay taxes, they are ignoring FICA. I'm not a fan of FICA b/c its not progressive. But if Bush had chosen to cut FICA instead of his mad dash to support his $5k/plate donors, we would have a tax cut that everyone would endorse.
Further, reducing FICA would have been a great benefit:
1) expose the true magnitude of the deficit . . . hopefully that would curtail spending
2) it would truly put SS/Medicare "on budget" . . . hopefully that would spur reforms
3) it really is a tax cut for everybody that pays taxes . . .
- if low/middle spend it . . . it trickles up and spurs the economy
- if rich people spend it . . . it trickles sideways/maybe down and spurs the economy
- businesses are free to invest savings in their company, employees, or shareholders
4) given the above we can have a real national dialogue about our priorities . . . and see where the chips fall . . . but Democrats that want higher taxes would be faced with tax/spend label . . . while Republicans trying to cut taxes for the wealthy would have to explain how that makes sense given that FICA cuts are more 'fair', have a greater economic impact, and aren't as subject to 'special interest' distortion . . . except the AARP effect.
Instead the Bush policies have gotten us higher deficits/debt, worsening long-term liabilites, and a horrible economy for the typical worker.
NYT
The median hourly wage for American workers has declined 2 percent since 2003, after factoring in inflation. The drop has been especially notable, economists say, because productivity ? the amount that an average worker produces in an hour and the basic wellspring of a nation?s living standards ? has risen steadily over the same period.
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Until the last year, stagnating wages were somewhat offset by the rising value of benefits, especially health insurance, which caused overall compensation for most Americans to continue increasing. Since last summer, however, the value of workers? benefits has also failed to keep pace with inflation, according to government data.
At the very top of the income spectrum, many workers have continued to receive raises that outpace inflation, and the gains have been large enough to keep average income and consumer spending rising.
That's the Bush economy . . . the claim of a good, growing economy only applies to certain zip codes and tax brackets. But it's 'prosperity' borrowed from the majority of the current workforce and all of future taxpayers.
But polls show that Americans disapprove of President Bush?s handling of the economy by wide margins and that anxiety about the future is growing. Earlier this month, the University of Michigan reported that consumer confidence had fallen sharply in recent months, with people?s expectations for the future now as downbeat as they were in 1992 and 1993, when the job market had not yet recovered from a recession.
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But Mr. Luntz predicted that the economic mood would not do significant damage to Republicans this fall because voters blamed corporate America, not the government, for their problems.
The American public is pretty simple but I'm not too sure they are that dumb . . .
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