Sunday, January 6, 2013

Why keep bringing up Social Security in discussions over debt?

I was watching Meet the Press this morning, and Carly Fiorina brought up the need to modify Social Security, while talking about the debt.  Is she naive, stupid, or politically motivated to lie, and lie repeatedly?

When Social Security was last modified in 1983, it was directly a result of the Greenspan Commission, and they tackled just one issue: Social Security.  Imagine if the Greenspan Commission were to have tackled Social Security funding by citing the importance of reducing defense spending -- nonsense, right?

As I've often written, Social Security is funded by the FICA payroll / SE taxes that you and I pay.  There is no borrowing in Social Security.  The fund is invested into special (nonmarketable) US bonds.  If you modify Social Security, it does not affect the deficit and debt of the United States.

This leads to the next perplexing issue.

Remarkably, you can hear and read Republican politicians (as well as pundits and news outlets) in the same discussion over Social Security, complain that taxes were raised when the fiscal cliff deal did not include the renewal of the FICA payroll / SE tax holiday.  Again, are they naive, stupid, or politically motivated to lie?
"A temporary reduction in the Social Security payroll tax rate reduced payroll tax revenues by $103 billion in 2011 and by a projected $112 billion in 2012." - 2012 SS Trustee Report Summary
Talk about trying to kill Social Security, or is that the quiet Republican goal?

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