Can republicans cut Medicare and Social Security and still convince the public that they are the cause of deficits, even though they have been historically paid for in full by payroll taxes, something that all employees have been paying for generations.
They basically are making the argument that it was OK to spend the payroll tax surplus yearly on policies like recent wars, department of homeland security, prison expansions and tax cuts for corporations and the wealthy, even though poorer middle-classes pay into it expecting to see a reimbursement later in life.
Consider also, these same poorer middle-classes would have probably really needed some of this money to just pay their rent or keep from getting behind on their bills, and one can see just how outright unethical this is.
Arguably no one who has seen 10% of their paycheck disappear permanently through the payroll tax would have agreed for the money to be spent on anything that wasn’t going directly back to them later in their life for their personal welfare, or from a direct reimbursement. Many millennials even believe they won’t see these same benefits when they are old. Republicans want to guarantee they won’t.
Payroll taxes are a separate tax than the income tax, and it’s considered a regressive tax. It is supposed to guarantee individuals have certain benefits later in life, (Medicare and Social Security reimbursements) but most economists believe that there will be a dwindling return as the years go on, because the government is spending the returns yearly on things like wars and tax cuts, instead of finding a way to invest the money. (Consider Norway’s Government Pension Fund).
Thus, the payroll tax mechanism is essentially a deflationary annuity paid by poor people. (It’s a regressive tax right?)
Funny enough, Republicans want to end Medicare and Social Security benefits, but they have never even considered a tax cut for payroll taxes, let alone considered lowering the payroll tax rate too. I always thought Republicans loved tax-cuts.
I guess not.
If the Democrats gain back the majority, they should try to make the payroll tax more progressive. Maybe the true tax rate of poor people should be 0%, and only wealthy people should pay payroll taxes. That would at least keep Republicans honest.
How many times do I hear “poor people don’t pay taxes”? Poor people shouldn’t be paying 10% of their income for the Republicans expensive wars and foreign involvements. Also, Democrats should be fighting to make Election Day a national holiday for every employee. The reason why Republicans have been getting away with most of their class warfare policies is by keeping minorities and poorer people out of the polling stations and at work.
Ironically all the while those same poor and minority classes are paying a higher tax rate then GE did last year. (GE’s effective tax rate last year was 7.4%)