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    Obama: Cut the Social Security Tax in Half

    09/10/2011

    Democracy and Power 103:  Government money

    In general, the art of government consists in taking as much money as possible from one party of the citizens to give to the other. – Voltaire (1764)

    The money taxed and spent by the politicians comes from the labor and ingenuity of millions of working persons.  Politicians spend other peoples’ money.

    Obama:  Cut the Social Security Tax in Half

    President Obama has proposed payroll tax cuts.  This is the FICA tax which funds Social Security and Medicare.  For employees, President Obama intends to cut the rate from the 6.2% of wages to 3.1%.  Additionally, the President proposes to cut the payroll tax for businesses in half --to 3.1% -- on the first $5 million in wages.

    These tax decreases are intended to spur consumer spending and increase business’ hires.  In essence, President Obama deems that it is urgently important for American workers to have more income and choices.  Likewise small business owners will use their earnings to expand their business and hire more employees.

    Of course, increased worker’s use of their money and expanding business is beneficial in good economic times.  So, why isn’t this a permanent policy?  Ah, yes, this is the FICA tax, which is intended to pay for Social Security and Medicare.  Under the President’s proposal, the government will receive less tax revenue, which will hasten and deepen the insolvency of Medicare and Social Security.

    In other words, the President and some Members of Congress deem it is urgently important for workers and businesses to retain more of their earnings.  As to the viability of Social Security and Medicare, the President and Congress will manipulate those problems later.   Hence, in the future, the President must seek tax increases to pay for Social Security and Medicare. Just as Voltaire observed:

    In general, the art of government consists in taking as much money as possible from one party of the citizens to give to the other.

    This is an immoral manipulation of a worker’s use and enjoyment of the fruits of their labor.  Only with personal accounts, where workers save, invest and own their accounts, will government stop manipulating a person’s earnings.

    Personal accounts for medical and retirement needs are essential.  A nation of owners will curtail the immoral exploitations of the politicians substantially.