So, as the Austerity Bomb nears and the deficit scolds attempt to use it as an excuse to dismantle social security (despite it not contributing to medium term deficit problems) a moderate Democrat from Alaska, Senator Mark Begich (who will probably lose his seat in 2014) has introduced a bill that will eliminate the current payroll tax cap, increase social security benefits to higher wage earners and install a special CPI based upon what seniors buy that will actually increase benefits for seniors.

The Congressional Research Service has projected that such a plan will eliminate 95% of the social security shortfall making in solvent for over 70 years. Consequently concerns that "Social Security won't be there for me" will largely be quashed.

Such a plan would break Obama's promise not to raise taxes on people earning under $250,000 but it would put one of the major entitlements on secure footing (although it preserves the payroll tax regime which many economists do not like).

Thoughts?

Could have/should have been done before ObamaKare was even considered.....taking care of the entitlements that we already have should have been a higher priority that ramming thru new ones. I don't necessarily agree with all that he proposes, but I am in full agreement that it needs to be addressed. Unfortunately, with no chance of ObamaKare being rescinded, and the tax on the middle class that it entails, it'll make it only that much harder to get Social Security fixed on a more permanent basis.

HitsRus;1322099 wrote:Could have/should have been done before ObamaKare was even considered.....taking care of the entitlements that we already have should have been a higher priority that ramming thru new ones. I don't necessarily agree with all that he proposes, but I am in full agreement that it needs to be addressed. Unfortunately, with no chance of ObamaKare being rescinded, and the tax on the middle class that it entails, it'll make it only that much harder to get Social Security fixed on a more permanent basis.

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BoatShoes;1322071 wrote:Such a plan would break Obama's promise not to raise taxes on people earning under $250,000

Didn't he already do that with Obamakare?

I'm skeptical to claims that removing the cap on a small number of individuals is going to make it solvent for another 50 years, especially when you are going to increase the benefits for seniors. Seems like the revenue projections always fall short, as do the spending projections, in these studies.

And if you want to be technical, SS is a social insurance program. There is a cap on what you pay in because there's a cap on the the benefits you receive.

This is not the sort of entitlement reform that will get the deficits under control. It's all fungible money, and that's how the govt has pretty much treated this all for years. Bottom line is you're only funding about 70% of your spending, so being fungible money SS has a 30% shortfall just like all the other govt spending.