Thread

1. GenerWork · 1790821127 · focus · HN ↗

   The primary issue is Social Security. It’s the biggest driver of spending, and nobody wants to do anything to cap its costs such as means testing or straight up lowering the amount it can pay out.

   As for the people that will inevitably bleat about how this is just horrible and we need to lift the cap on taxable SS income, that wouldn’t solve the core problem either unless you pair it with spending caps or cuts.

   1. consumer451 · 1790821686 · focus · HN ↗

      There is an easy solution to make Social Security solvent. Uncap the contribution. Problem solved.

      1. kolanos · 1790822115 · focus · HN ↗

         Why would someone contribute more than they are legally required?

         1. patch_cable · 1790822299 · focus · HN ↗

            I think the argument is for changing what is legally required.
         2. judge2020 · 1790822407 · focus · HN ↗

            Right now a ton of wages from top earners are not being taken out for social security because the cap is around 176k (for the current year); I'm assuming it would simply extend the timeline for it hitting its deficit.

            1. [deleted] · 1790823982 · focus · HN ↗

               [deleted]

         3. Lightbody · 1790822408 · focus · HN ↗

            They wouldn’t and with the current cap they don’t. Uncap it (or just raise the cap) and now they will have to contribute more.
      2. missedthecue · 1790822566 · focus · HN ↗

         This would add some more years of runway but does not solve the problem. Eventually, the fund would reach insolvency again. The SSA actuaries estimate that removing the cap would add 21 years before insolvency. 21 years may sound like a lot compared to the handful remaining now, but is well before the retirement age of the average person reading this comment.

         Also an underdiscussed issue with such a policy is that while it increases social security fund revenue, it decreases the amount of federal revenue collected. The CBO estimates that about 15% of revenues gained by an uncapped SSA tax are offset (lost) by a reduction in federal revenues. Worsening the deficit problem.

         <a href="https:&#x2F;&#x2F;www.cbo.gov&#x2F;budget-options&#x2F;60955" rel="nofollow">https:&#x2F;&#x2F;www.cbo.gov&#x2F;budget-options&#x2F;60955

         1. conception · 1790823248 · focus · HN ↗

            <a href="https:&#x2F;&#x2F;www.crfb.org&#x2F;socialsecurityreformer&#x2F;" rel="nofollow">https:&#x2F;&#x2F;www.crfb.org&#x2F;socialsecurityreformer&#x2F;

            It’s actually pretty easy- pick three or four options that have the very wealthy kick back into society what they have been syphoning out and it balances.

         2. seanmcdirmid · 1790823852 · focus · HN ↗

            Uncapping income it is applied to and throwing in capital gains would totally solve the problem if you sever the link between contributions and payout (which is a form of means testing).

            1. sharts · 1790833859 · focus · HN ↗

               And dividends

               1. seanmcdirmid · 1790853976 · focus · HN ↗

                  Dividends are already taxed as income.

                  Edit: I didn&#x27;t realize dividend income was not subject to payroll taxes.

                  1. bovinejoni · 1790864209 · focus · HN ↗

                     The vast majority of US dividends are qualified and subsequently taxed at much lower rates than regular income tax rates
                  2. HDThoreaun · 1790891722 · focus · HN ↗

                     Only if youve owned the stock for less than a year. Over a year its capital gains
      3. pgodzin · 1790823640 · focus · HN ↗

         that would be one of the largest tax increases in history, used to fund transfer payments to the disproportionately wealthy

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