Entitlements equal Social Security and Medicare
We hear a lot of talk about lowering the deficit these days, usually from the same folks who vehemently push for lower taxes. With only 12 percent of the federal budget devoted to "discretionary" spending, we are informed "everything" must be on the table.
"Everything" usually DOES NOT include military spending. "Everything" means "entitlements." Eliminating "entitlements" is an integral component of the push to achieve smaller government. The first step will be a decrease in the benefits.
"Entitlements" mean Medicare and Social Security. We are informed these are the biggest slices of the budgetary pie (aside from military spending and interest on the debt that is).
Until the Obama/McConnell tax bill passed, if your annual salary was $40,000, you and your employer paid $4960 into Social Security. If your annual salary was $106,800, you and your employer paid $13,243 into Social Security. In both cases the annual contribution was 12.4 percent of the employee's salary. If your annual salary was $1 million, the annual contribution totalled $13,242 or .013 percent of your salary. (You are also entitled to the same annual payments as anyone else who has paid the maximum into the system ($106,800 and up)).
That is because Social Security was designed to be paid from the contributions made into it. It is an entitlement because we are entitled to it.
The tax bill reduces employees' 2011 contributions to 4.2 percent of their income up to $106,800. Employers' contributions remain unchanged. For someone paying in the maximum, this is a decrease of $2136. On $53,000, it is a decrease of $1060. This is money that will never be placed into the fund. The tax bill provides for shortfalls to be made up from the "general fund." This is a dangerous precedent. Instead of being self-funding, Social Security could become dependent upon general tax revenues - and far more vulnerable to the arguments of budget-busting legislators.
Retirement Age
Raising the retirement age is another important ploy of the anti-entitlement crowd. If you have worked at a white collar job during your employment years and are in good health, retiring at 70 may not be a pleasant prospect, but it is probably doable. If your work involved hard, physical labor, your body's natural aging will make continuing difficult. And if the wear and tear on your body caused by intense physical labor is substantial, it could be impossible.
Keep your eyes on Washington. Do NOT let them destroy the program that may be the only thing separating hundreds of millions of Americans from destitution in their senior years.
Here's what I think...
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment