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PayRoll Tax Extension necessary.. Or we are facing a painful 2012...
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2011 Nov 16, 5:17am 1,872 views 3 comments
by LAO ➕follow (0) 💰tip ignore
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simchaland
2011 Nov 16, 5:58am
Look, this "tax reduction" is a travesty.
It was just another crack from the 1% to dismantle Social Security.
Payroll taxes go into a retirment account for the 99% that will be drawn once we reach the age of retirement. Reducing payroll taxes today simply places our retirement account in danger of collapse when we the 99% (especially we Gen Xers) retire.
It's sad that many in the 99% got duped into thinking that this "reduction in taxes" is a good idea.
This "tax" turns into deferred wages that should be there when we need it the most.
Yes it affects the 99% but not in the way you posit.
This is one of the first steps to eliminating Social Security for the 99%. If we don't contribute to our own unemployment insurance, disability insurance, and retirement insurance, it won't be there for us when we need it most. This reduction in contributions to Social Security harms us in the 99% in the long run.
This was simply a cynical bone to throw at Republicons (the 1%) so that they could hold their noses and vote to approve the deal that stopped us from defaulting on our debt.
The spin on this is disgusting and it's time that the 99% educates ourselves on how Social Security actually works.
(Hint: It doesn't affect the Federal Budget at all (or it's not supposed to) because it's a separate account. Congress has been using our Social Security fund to cover a portion of the Federal Deficit for decades at the 99%'s peril. They are raiding our Social Security Funds like the corporations were allowed to raid pensions when going Bankrupt. It's robbery from the 99%.)
LAO
2011 Nov 16, 6:38am
Look, this "tax reduction" is a travesty.
Ending it now during a recession will just cause people to stop contributing to their 401ks or saving money on their own...
SS is screwed either way... without major reforms all 20-30 year olds won't even get back what they now contributing to SS.
Wait til the middle class gets out from underwater on their homes and the economy improves before pulling out the rug on this tax deduction.
This the same argument everyone gives for a temporary tax reduction. Move along, nothing to see here. Everyone paid 6.2% out of their end for many years until this year and nothing catastrophic will happen if we go back to it.
If Obama can't get his payroll taxes at the very least extended.. and ideally lowered to 3.1% from 4.2% currently.. (down from original 6.2%). Then look out below...
Starting Jan. 1st, 2012, if nothing changes, A family household earning $110K a year... will essentially get a PAY CUT of $2200! That's equal to a monthly car payment! Or a really nice family vacation...
If you think that $2200 will go unnoticed by the middle class... you are mistaken. Most to compensate will just lower their 401K contributions.. (crushing the stock market). Or cutback on spending/saving when they see their paychecks each month dropping by $183 a month.
If you think 2011 was a bad year for consumer spending... 2012 will be horrendous without payroll tax cut extension or increase.
I don't know how Republicans can be for maintaining Bush Tax cuts for the rich and allowing taxes to rise on the vast majority of those households making under $110K a year.
This lapse will raise taxes 2% on the middle class, while the top 1% won't be affected at all.. Because it won't change the tax rate on any income earned over $110K.
This won't help home sales at all in 2012 either... It will pinch household budgets even further... possibly causing more foreclosures.
#housing