Invest Your Tax Cut in Your Retirement

• Report this Comment On December 24, 2010, at 7:53 AM, pappyg2 wrote:

  Time To “MAN UP”

  When two party agreements are entered into, the agreement’s success hinges on both parties living up to their end of the bargain. Today we’re having the wrong conversation regarding Social Security. When President Reagan signed SS reform legislation in 1983, he created a new agreement between the people and their government. At the official signing of the agreement, the President said, Social Security is “fixed for the next 75 years” - Remember? As per that agreement millions of average hard working Americans began overpaying their SS taxes by billions of dollars annually so another SS crisis conversation in 2011 wouldn’t be necessary - Remember?

  If you’re one of those hard working middle class Americans, you’ve generated 12.4 cents for the SS trust fund for every dollar you’ve earned. The financial sacrifices you’ve made have been significant, yet In spite of these sacrifices, you kept your end of the bargain - Remember? Now politicians are suggesting those same hard working middle class Americans should sacrifice again by having the SS retirement age raised, and/or adjusting future SS benefits. Wouldn’t you agree the other party to this agreement should start doing a little sacrificing by living up to their end of the bargain?

  I’m talking about the other party who benefitted when 2.54 trillion dollars of potential SS trust fund retirement dollar assets were transferred from the SS trust fund to the general revenue fund. That transfer left behind 2.54 trillion in new SS IOU debt, a net loss of 5 trillion dollars plus. Politicians used 2.54 trillion dollars of SS retirement dollars to subsidize corporate and income tax rates, fund tax cuts, pay for wars, mask the true size of annual federal budget deficits, and fund earmarks among other things. If a deal really is a deal, then the other party, the politicians better figure out a way to “MAN UP”, and begin living up to their end of the bargain.

  The SS conversation must begin anew, and middle class working Americans can’t afford to ignore it this time. The talking points must be fair and balanced and to the point, and the point is; working Americans have kept their end of the deal, now politicians must their end, and until they do, don’t ask middle class Americans to sacrifice again. It’s time those who’ve ridden the backs of average working Americans to their prosperity to “MAN UP” and fulfill their obligations. The “MAN UP” plan: http://www.slideboom.com/presentations/266125/Man-Up

• Report this Comment On December 24, 2010, at 4:50 PM, xetn wrote:

  What tax cut? There is no tax cut, there is only an extension of a previous tax cut.

• Report this Comment On December 24, 2010, at 4:53 PM, xetn wrote:

  Oh, and there will be a real tax increase called inflation. As a matter of fact, we are already paying that tax and have been since 1913. That tax is the 97% reduction in the purchasing power of the dollar. And, with the spending already approved and the dollar inflation of the Fed it will get a lot worse until the US ends of defaulting on its debt.

• Report this Comment On December 26, 2010, at 10:51 PM, vidar712 wrote:

  {Just a warning: It starts out sounding like I have a point, but then it dissolves into semi-related thoughts.} {Also, I know no-one will read this, but I wanted to respond (just for fun).}

  @pappyg2

  ?

  I don't see the two parties of the agreement.

  I see our side ('us'). And the other side is the politicians (people who represent 'us') ('us' again).

  So we have 'us' and 'us'.

  I guess what you are saying is not everyone (of 'us') has been living up to the sacrifice.

  Do you want to know who hasn't been suffering under the full sacrifice we agreed to? It's you, and me. Everyone ('us').

  When the politicians, decided to lower taxes and provide additional services to the people, the people ('us') benefited. <I'm sure everyone would debate this, but since someone benefited and since someone is part of 'us', the people benefited.>

  In math term, you suggest the equation is:

  Hard work + sacrifice = Funded Social Security.

  I'm saying:

  Hard work + sacrifice - government benefits = unfunded social security.

  The way I see it, when the government provides a tax break or spends your money for 'services' <I cringe when I write services.> They are taking money out of your social security. As government 'benefits' increase (reducing taxes or spending on services), social security funds decrease. (It's like taking money out of your 401K to buy a TV, only the government isn't paying a 10% early withdrawal penalty to itself.)

  I also see it similar to how a 401K contribution comes out of money in your highest tax bracket. When the government over spends, it comes out social security rather than the general fund. The only time it doesn't come out of social security is when we have a budget surplus (remember those?)

  Anyway, what I'm saying is that you are the one who needs to 'Man Up'. YOU need to tell your political representatives that you want taxes to go up (increase taxes). YOU need to tell your political representatives that you want less services from the government (reduce spending). YOU tell the government that you want to sacrifice (the agreed amount) because YOU want social security to be funded.

  When they were considering extending the Bush tax cuts, you should have been screaming bloody murder to let them expire. Now that the government is reducing funding Social Security by 6.5%, you should be screaming bloody murder. (Covering Social Security from the general fund would only work if we had a budget surplus. Otherwise it will come from the least desirable place (social security).)

  You make a valid point in your post, it just it is directed at some boogie man living in the government (who is stealing all your money). When really (if you think abstractly enough) you are stealing from yourself (for stuff you don't want.)

  - If a politician tries to give you money, you should say 'no'. (You will get the money anyway. All you have to do is wait.)

  - Here is a secret about America: From the homeless person asking for change to multimillionaires, everyone considers themselves to be 'Middle Americans'. (Don't you consider yourself to be a middle american?)

  @Chuck Saletta

  How is a 6.5% reduction in taxes equate to a 2% increase in net income?

• Report this Comment On December 29, 2010, at 10:55 PM, TMFBigFrog wrote:

  xetn:

  The deal both kept income taxes from increasing and provided a 1-year actual reduction in the Social Security tax. That is a reduction from even the Bush tax rates.

  vidar712:

  The employee portion of the Social Security tax rate is going from 6.2% to 4.2%. In effect, if you have a $100,000 salary, you used to see $6,200 of Social Security taxes taken out each year. In 2011, you'll see $4,200. That leaves you with $2,000 more in your pocket, or an additional 2% of your salary in your pocket.

  Hope this helps.

  -Chuck

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