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The Payroll Tax Cut Deal – Manipulating the Citizen’s Earnings


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)

Money taxed and spent by politicians comes from the labor and ingenuity of millions of workers.  Politicians spend other peoples’ money.

The Payroll Tax Cut Deal – Manipulating the Citizen’s Earnings

Senator Max Baucus (D-MT) and Representative David Camp (R-MI) forged a “deal” on cutting the payroll tax until the end of 2012.  With this deal, 160 million workers will receive up to $2,000 more income this year.  Needless-to-say, those 160 million workers will gladly welcome the additional funds.  But beware, this is an election year ploy by both Republicans and Democrats to pander for votes.

Everyone knows America has a debt problem.  Few Americans know, however, that this “deal” will add $200 billion to our debt.  Immorally, these politicians – Democrats and Republicans – are predominately and overwhelmingly focused on being elected next November and less concerned about the consequences of their actions.   Most Americans are concerned about being employed, caring for their family, friends, neighbors and community, and, therefore, have little to no time to focus on America's big picture.  So, what does this “deal” do to America?

The “deal” itself is simple; every worker receives 2% more in income.  However, this simple legislation quickly becomes an ugly exchange of votes for favors by politicians.  Hence, the leaders of the Republican and Democratic parties basically bribed their legislators for their votes.

 What was added to the payroll cuts?

  • There is the doctor fix.  Medicare payments to physicians were increased by about 30%,
  • Long term unemployment benefits were extended.
  • New federal workers can contribute more to their defined retirement plan.
  • Federally controlled airwaves were auctioned off to wireless companies.
  • $7 billion was cut from hospitals to cover debts.
  • $5 billion was cut from ObamaCare’s prevention fund, which is used to help curb things like childhood diabetes and smoking.
  • Medicaid payments were cut to Louisiana residents.
  • Electronic welfare cards cannot be used at strip clubs, casinos and liquor stores.
  • Federal payments to medical labs were reduced.
  • Drug testing of unemployed people, who had tested positive before or who were seeking work in certain jobs, were implemented.

 What was proposed by our “honorable” lawmakers?

  • Requiring Social Security numbers to utilize child tax credits.
  • Unemployed persons must enroll for a high school GED.
  • Higher contributions by federal workers to their defined benefit plans.

In the 18th century, when absolute monarchs ruled, Voltaire wrote:

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.

A century later, Otto von Bismarck of Prussia is reported to have said:

Laws are like sausages. It is better not to see them being made.

Alas, the political animal remains the same.  The political beast is best controlled by severely limiting their power.  To effectively limit their power, we can't let them take our money –  we must keep the tax-rate low.  Next, we can't let them create more debt.  There are many avenues to limit power and stop debt accretion.  Making politicians personally and financially responsible is one such avenue.

Alas, We the People have a gigantic struggle to limit the power of our elected elites.

Fredrick Wilson