General Discussion
Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsCan the cap on income subject to SS be lifted without a Supreme Court challenge?
That is the only reason I can think of to prevent Obama from suggesting it. And given the make-up of this Supreme Court, he might be right. Perhaps if we get a "better" arrangement on the Court, we can start this conversation?
unblock
(52,253 posts)don't answer, i know: "rich people don't like it".
supreme court, 5-4: "yeah, sounds good to me!"
CTyankee
(63,912 posts)SS system (they are taxed more in the program but getting less than others with more modest incomes do).
unblock
(52,253 posts)there is a linkage between current benefits out and PAST payments in, but as it stands, congress could legally change the formula for the future to completely ignore past contributions.
so i don't see how changing the tax basis for present contributions could possibly change anything constitutionally. there's already zero guarantee that your tax contributions will affect your future benefits in any way.
more to the point, the cap changes (nearly) every year, somewhat correlated with inflation. if this isn't a problem, eliminating it altogether shouldn't be a problem either.
finally, the entire point of social security has ALWAYS been to provide a retirement benefit NO MATTER WHAT bad news you run into prior to retirement. rich people can use this as well. it enables them to bet ALL of their riches on investment without worrying about having NOTHING even if they go bankrupt. in fact this benefit helps them to confidently try to gain a TON of extra money, so in a sense it's more valuable to them than to the rest of us. plus, it helps them set up companies that don't provide pensions, which is also more profitable for them.
JustAnotherGen
(31,828 posts)But good question. I thought it could be overcome with legislation. . .
PoliticAverse
(26,366 posts)CTyankee
(63,912 posts)I'm not arguing against the idea, just trying to figure out why lifting the cap has not been seriously discussed...
PoliticAverse
(26,366 posts)Obama has repeatedly said he favors raising the cap.
See for example recently: http://www.huffingtonpost.com/2012/09/21/obama-social-security_n_1903773.html
The reason it hasn't been implemented is political. Obama didn't pursue this issue strongly when the Democrats controlled
both the Senate and the House and with the Republicans controlling the House now it would be difficult to implement.
SCantiGOP
(13,871 posts)so it could be altered by the Congress.
The Magistrate
(95,247 posts)Congress has full authority to alter the terms of both the tax and the pay-outs of the Social Security system; no one has an enforceable right to a particular rate or amount.
The thing could, if people were kittenish, be handled purely as a taxing matter, in any case: the cap could be lifted, and then the tax on benenficiaries income over a certain amount adjusted so that the payout to those who had paid FICA tax on amounts greater than the present cap would be taxed down to the present cap on benefits paid. There could not be a shadow o a Constitutional quibble with this course.
CTyankee
(63,912 posts)Why the silence, even from our liberal/progressive lawmakers?
The Magistrate
(95,247 posts)Removing the cap would be the quickest and in my view most equitable 'fix' for the system. Personally, I would like to see a surcharge on the capital gains tax levied, and dedicated to the Social Security fund....
CTyankee
(63,912 posts)What has befuddled me is that only those of us on the sidelines are talking about it. OK, maybe with the exception of Bernie Sanders, but he is a Socialist. Time for us to get this idea more "mainstream." I think the American electorate is in the mood for it right now...
Egalitarian Thug
(12,448 posts)doesn't talk about it are that it would immediately become the issue of the moment and that it is a perfectly reasonable and easily achievable solution to a non-existent problem that both parties have worked a long time to create for their employers.
CTyankee
(63,912 posts)So you are implying that it will eventually get there? I hope so!
Egalitarian Thug
(12,448 posts)agreement with what they're being told. If you work with finance or numbers one thing you must realize is that projections beyond a very few years are meaningless, there are just too many variables and indeterminate circumstances for there to be any resemblance to the reality you eventually get. So when someone tells you that SS will be fine until 2025 or will go broke by 2020, they're just making a wild guess based on filling in the numbers on the spreadsheet to achieve the results they want.
So, while there probably will be some potential problem with funding SS at some point in the future, saying that this or that simply must be done now is pushing another agenda. The fact is that SS is just fine right now and, barring some tectonic shift in the economy, will remain so for at least the next five years. Of course, the best possible solution to the potential problem is a combination of eliminating unemployment and rising wages particularly at the bottom.
We have so many other real problems that should be dealt with right now that worrying about this one is either disingenuous or foolish.
GeorgeGist
(25,321 posts)to think that 5 years is a long time.
Egalitarian Thug
(12,448 posts)can project economic trends with any reasonable degree of accuracy.
Did you read my reply?
Zo Zig
(600 posts)top end on SS, 94K?
Champion Jack
(5,378 posts)k8conant
(3,030 posts)Take this cap off!
wishlist
(2,795 posts)Social Security taxes are just that, taxes that can be levied by Congress and raising taxes is Constitutional. The only reason health care mandate came before Supreme Court was that the penalty was not specifically called a tax under the Affordable Care Act. Justice Roberts wisely decided that the penalty was in fact actually a tax and therefore Constitutional.
But Federal taxes cannot be changed by Presidential executive order, requires Congress.
CTyankee
(63,912 posts)That would seem to strengthen the hand of those of us who want to see this change made...
glacierbay
(2,477 posts)so I don't really know a whole lot about this, but it would seem that the congress can remove the cap on SS w/o the threat of a court challenge, I don't see a constitutional problem here.
Just my opinion of course.
Warren Stupidity
(48,181 posts)there really is no reason to increase the revenue stream into Social Security. Medicare needs revenue help, SS doesn't. Medicare funding isn't capped at all.
If and when SS actually needs more revenue to meet current obligations, that would be the time to consider an increase.
rocktivity
(44,576 posts)and EVERYONE could pay LOWER rate!
rocktivity
TheKentuckian
(25,026 posts)There comes a point when folks are digging for shadows to chase them into inaction so even the most sensible plans of action can be punted into some hoped for future, while the profits from the status quo continue and grow which also postpones indefinitely any change as well.
Being utterly risk adverse means poor leadership and weak action and it means becoming conservative, not regressive but certainly conservative in a dictionary definition kind of way and eventually to inaction to the point of paralsys except what is safe, which to their minds means blending in with the regressives.