Captain America

I promise I'll get back to posts about crazy stuff my kids do, but I'd like to provide the solution to a "crisis" facing the USA. Social Security will not have enough funds to pay its promised benefits in the next 10-50 years depending on your sources. You might remember President Bush made social security reform his top priority after his re-election. You might also know that this president has increased the federal deficit every year he's been in office. Why would he want to shore up a government entitlement program w/o regard to the rest of the government's debt? Compassionate conservatism? Reaganomics? Maybe b/c the easiest way to balance the social security books is to raise the amount of income subject to the tax. In 2007 the first $97,500 of your wages are taxed at 15.3% (your employer pays half of it if you aren't self-employed, so that's "only" 7.65% for a lot of people). The max figure goes up each year for a "cost of living" increase, but there will be a big spike in that number when the projected shortfall is about to hit. Essentially, it will be a tax increase for people making say $120,000 or more in 2020 (just a guess on the $ and date). Ordinarily, I'm not opposed to tax increases (especially if they don't pinch me), but I have one little issue about this one. Social Security tax is only for wages. When your millions are making thousands just by being there, you don't get taxed on that income by FICA (or Medicare). People who actually earn the big bucks (or at least get paid big bucks) will pay more in taxes than those who make the same amount simply by letting their money work for them. Ultimately, that means the super rich won't be hit hard by this increase and the "crisis" will be solved.