I tried to see if Trump had actually proposed anything new to fund Social Security, the answer is, of course, 'no'. His only plan is to exempt Social Security benefits from federal taxes, which would give more money to higher income recipients, but only cause the program to bleed money faster.
I tried to see if Trump had actually proposed anything new to fund Social Security, the answer is, of course, 'no'. His only plan is to exempt Social Security benefits from federal taxes, which would give more money to higher income recipients, but only cause the program to bleed money faster.
Harris is supporting the same "donut hole" plan as Biden: Charge Social Security taxes on income over $$400,000, but not income between $168,600 and $400,000. The hole would gradually fade over time, as the lower limit is adjusted for inflation, while the upper one is not.
I have never understood how Democrats have bought into the idea that middle income extends to $400,000. Someone making $300,000 is living pretty damned well even in LA or NY.
Many established professionals, including doctors, lawyers and engineers, can easily see north of $400k, esp later in their careers. They aren't "middle class" exactly, but they're hardly the upper class like millionaire celebs, investors and families that often live in mansions or own summer homes. My parents, both being doctors are among such people. You find many upper middle class folks in the OC and SoCal, including many Asian Americans. We definitely have substantially more income to spend, but we're far from celeb status wealthy. Many including my dad, go screwed with Trump's petty elimination of tax deductions for SALT on property taxes.
It’s inequitable to raise taxes solely on people who are already paying more than those who make more money than they do, just because they don’t have the power to stop us. We need to actually tax the actually wealthy.
Of course the super-rich need to be taxed more. That doesn't mean that, for example, higher wages should continue to be taxed less than lower wages for Social Security.
Because of how benefits are calculated, the flat payroll tax that everyone pays on income up to the cap, returns a lesser percentage the higher the wage on which taxes are paid (all else equal). The return on the last dollar paid is less than 1/6th that on the first dollar paid. The folks paying up to the cap are already subsidizing the system substantially. The donut hole idea (which I generated independently over 20 years ago before ever having capped out myself), has a strong basis in equity. The slowly closing donut hole much less so.
I'm not really understanding you, but I do know that higher income is taxed less for Social Security, and there's no possible way anyone can justify that to me.
Social Security isn’t just a tax, it takes with one hand and gives back more with the other. Ignoring the insurance value, which makes it a net positive for pretty much everybody, if you look at the cost net of benefits received back, it’s effectively a time delayed negative income tax for low earners with huge returns that decline as you go up the income scale until the marginal rate goes positive, and top contributors are subsidizing others, with the cap coming before the overall effective rate becomes a positive tax. Everybody benefits, but without the cap that’s no longer true.
In the US, we have developed an anti tax mentality that is quite different from the thought process in Europe, and unfortunately it has taken hold in the Democratic party.
In the long run, to provide public services, we have to require people to pay an adequate amount of taxes to cover those services, and it can't be done by only taxing the ultra wealthy.
The median household income in OC CA is $106k, in Irvine, considered an affluent area, $126k. People earning $400k aren't ultra rich, but they are doing well and should be taxed.
In part our notion of what is middle income has been skewed downward by the past two generations in which capital has stolen most of the increase in national income from the bottom 99%. First, a typical definition of the top of middle income would be double the median household income adjusted for household size. As of last year that was $183k for a 3 person household, so about $106k for 1 person or $236k for a family of 5. If you instead set the top of the middle class at 2x the median household income in 1970, and scale income with GDP per capita instead of inflation (i.e. distribute economic gains through wages as from 1946-1970 instead of allowing them to be concentrated as wealth), the top of the middle class would be at roughly $275k for an individual, $478k for a family of 3. The bottom of the middle class, i.e. the top edge of “poor” if held at the share of the pie for a household with 2/3rds median income in 1970, would be $91k for an individual in 2023. We have collectively been pushed out of the middle class and into lower income brackets by the collective action of the wealthy to concentrate income and assets in only a few hands over the past two generations. When we see folks making $400k as “them” rather than “us” we are mistaking the situation. They are just the luckiest of us, but all of us are and have been being slowly squeezed into serfdom by the folks making $400mil.
I make way less than your bottom of the middle class and always have, and I'd happily pay $1,500 more per year in taxes in exchange for universal no-cost healthcare. It's not about wealthier workers being "them"; it's about people being better able to pay some more for the common good, which is a collective responsibility.
The collective responsibility should include us seeing that you are paid better, not charging you for the failure of the elite to hold up their end of the stick. We need to tax the rich, but not just tax them, stop their theft from us: raise wages, save money on healthcare while making it universal, etc. The time for broad based taxes to meet societal needs is when income and wealth is broadly shared. For now, soak the rich.
If you want to create an economy in which there are full-time tenured positions for everyone with a Doctorate and all music gigs pay at least $100/hr, with benefits, go for it, but I can easily survive on my current income, as long as I have almost no medical expenses, though other expenses can be challenging and who knows what I'll make next year?
Forgive my presumption, but am I right in thinking you have a long ago rent controlled apartment cushioning the comfort level of your cash income? If you had to pay market rate for housing would you still characterize your income as you do? I think housing should be broadly cheaper than “market rates” in an artificial supply shortage, but I also think you, and most people, are underpaid.
Rent stabilized. That's correct. If I had to pay $3,000/month, I couldn't make it as a musician. The lack of sufficient housing, and particularly affordable housing, is a huge crisis in this country. That's another reason to tax people more according to their ability to pay: to launch a crash program of public housing nationwide. Providing people with more money doesn't solve a problem of scarcity.
benamery21, did I delete your reply by mistake by deleting a double post? If so, sorry. (I now see that that didn't happen.) But my reply to you is that I don't need to have a guaranteed income of $91K and don't think that only the super-rich should be taxed, though I think it should not be possible for Musk to become a trillionaire, and beyond a certain level of assets, there should be 100% taxation.
To be more precise the lower limit, which is currently the cap, is adjusted based on a wage index called the AWI which historically goes up faster than inflation. It’s gone up 42% since 2016.
This is true of Social Security in general. Broadly speaking, this means seniors benefit from productivity gains, rather than being locked into the goods and services from 1933.
Yes, broadly speaking. Initial benefits are also indexed in this fashion. More narrowly speaking the index is skewed upward by uncovered income and employed middle income folks who were just above the cap and aren’t seeing wages go up with productivity have gotten hosed the past few years.
I tried to see if Trump had actually proposed anything new to fund Social Security, the answer is, of course, 'no'. His only plan is to exempt Social Security benefits from federal taxes, which would give more money to higher income recipients, but only cause the program to bleed money faster.
Harris is supporting the same "donut hole" plan as Biden: Charge Social Security taxes on income over $$400,000, but not income between $168,600 and $400,000. The hole would gradually fade over time, as the lower limit is adjusted for inflation, while the upper one is not.
I have never understood how Democrats have bought into the idea that middle income extends to $400,000. Someone making $300,000 is living pretty damned well even in LA or NY.
I think it has less to do with protecting their voters, and more to do with the interests of the class of people who write $3300 checks.
Many established professionals, including doctors, lawyers and engineers, can easily see north of $400k, esp later in their careers. They aren't "middle class" exactly, but they're hardly the upper class like millionaire celebs, investors and families that often live in mansions or own summer homes. My parents, both being doctors are among such people. You find many upper middle class folks in the OC and SoCal, including many Asian Americans. We definitely have substantially more income to spend, but we're far from celeb status wealthy. Many including my dad, go screwed with Trump's petty elimination of tax deductions for SALT on property taxes.
To follow up, such people are generally already paying higher effective tax rates than the actually wealthy.
True, but that doesn't make them overtaxed.
It’s inequitable to raise taxes solely on people who are already paying more than those who make more money than they do, just because they don’t have the power to stop us. We need to actually tax the actually wealthy.
Of course the super-rich need to be taxed more. That doesn't mean that, for example, higher wages should continue to be taxed less than lower wages for Social Security.
Because of how benefits are calculated, the flat payroll tax that everyone pays on income up to the cap, returns a lesser percentage the higher the wage on which taxes are paid (all else equal). The return on the last dollar paid is less than 1/6th that on the first dollar paid. The folks paying up to the cap are already subsidizing the system substantially. The donut hole idea (which I generated independently over 20 years ago before ever having capped out myself), has a strong basis in equity. The slowly closing donut hole much less so.
I'm not really understanding you, but I do know that higher income is taxed less for Social Security, and there's no possible way anyone can justify that to me.
Social Security isn’t just a tax, it takes with one hand and gives back more with the other. Ignoring the insurance value, which makes it a net positive for pretty much everybody, if you look at the cost net of benefits received back, it’s effectively a time delayed negative income tax for low earners with huge returns that decline as you go up the income scale until the marginal rate goes positive, and top contributors are subsidizing others, with the cap coming before the overall effective rate becomes a positive tax. Everybody benefits, but without the cap that’s no longer true.
I'm not buying that as a good argument. Taxing higher salaries at a lower rate is regressive, period.
In the US, we have developed an anti tax mentality that is quite different from the thought process in Europe, and unfortunately it has taken hold in the Democratic party.
In the long run, to provide public services, we have to require people to pay an adequate amount of taxes to cover those services, and it can't be done by only taxing the ultra wealthy.
The median household income in OC CA is $106k, in Irvine, considered an affluent area, $126k. People earning $400k aren't ultra rich, but they are doing well and should be taxed.
They're not super-rich, but they can surely afford to pay a bit more in taxes, right?
In part our notion of what is middle income has been skewed downward by the past two generations in which capital has stolen most of the increase in national income from the bottom 99%. First, a typical definition of the top of middle income would be double the median household income adjusted for household size. As of last year that was $183k for a 3 person household, so about $106k for 1 person or $236k for a family of 5. If you instead set the top of the middle class at 2x the median household income in 1970, and scale income with GDP per capita instead of inflation (i.e. distribute economic gains through wages as from 1946-1970 instead of allowing them to be concentrated as wealth), the top of the middle class would be at roughly $275k for an individual, $478k for a family of 3. The bottom of the middle class, i.e. the top edge of “poor” if held at the share of the pie for a household with 2/3rds median income in 1970, would be $91k for an individual in 2023. We have collectively been pushed out of the middle class and into lower income brackets by the collective action of the wealthy to concentrate income and assets in only a few hands over the past two generations. When we see folks making $400k as “them” rather than “us” we are mistaking the situation. They are just the luckiest of us, but all of us are and have been being slowly squeezed into serfdom by the folks making $400mil.
I make way less than your bottom of the middle class and always have, and I'd happily pay $1,500 more per year in taxes in exchange for universal no-cost healthcare. It's not about wealthier workers being "them"; it's about people being better able to pay some more for the common good, which is a collective responsibility.
The collective responsibility should include us seeing that you are paid better, not charging you for the failure of the elite to hold up their end of the stick. We need to tax the rich, but not just tax them, stop their theft from us: raise wages, save money on healthcare while making it universal, etc. The time for broad based taxes to meet societal needs is when income and wealth is broadly shared. For now, soak the rich.
If you want to create an economy in which there are full-time tenured positions for everyone with a Doctorate and all music gigs pay at least $100/hr, with benefits, go for it, but I can easily survive on my current income, as long as I have almost no medical expenses, though other expenses can be challenging and who knows what I'll make next year?
Forgive my presumption, but am I right in thinking you have a long ago rent controlled apartment cushioning the comfort level of your cash income? If you had to pay market rate for housing would you still characterize your income as you do? I think housing should be broadly cheaper than “market rates” in an artificial supply shortage, but I also think you, and most people, are underpaid.
Rent stabilized. That's correct. If I had to pay $3,000/month, I couldn't make it as a musician. The lack of sufficient housing, and particularly affordable housing, is a huge crisis in this country. That's another reason to tax people more according to their ability to pay: to launch a crash program of public housing nationwide. Providing people with more money doesn't solve a problem of scarcity.
benamery21, did I delete your reply by mistake by deleting a double post? If so, sorry. (I now see that that didn't happen.) But my reply to you is that I don't need to have a guaranteed income of $91K and don't think that only the super-rich should be taxed, though I think it should not be possible for Musk to become a trillionaire, and beyond a certain level of assets, there should be 100% taxation.
Agreed. It's stupid. People making that much money should have tax increases, except in unusual circumstances.
To be more precise the lower limit, which is currently the cap, is adjusted based on a wage index called the AWI which historically goes up faster than inflation. It’s gone up 42% since 2016.
This is true of Social Security in general. Broadly speaking, this means seniors benefit from productivity gains, rather than being locked into the goods and services from 1933.
Yes, broadly speaking. Initial benefits are also indexed in this fashion. More narrowly speaking the index is skewed upward by uncovered income and employed middle income folks who were just above the cap and aren’t seeing wages go up with productivity have gotten hosed the past few years.