Most of the people earning between 250k and 400k would be better off with the Clinton rates and the

[dsc]

payroll tax cut. The pay roll tax cut is a 2% cut to the SS tax which covers wages up to 110k. Now a couple earning between 250k can earn that in a multitude of ways but here are the boundaries of the choices. There could be no earned income, then Obama's compromise is worse (cap gains rate goes up).

One person could earn all the income. Then only 110k would be subject to SS. The payroll tax saves that couple 2200 a year. That couple would have to earn more than 311,111.11 before they would save money under a system keeping a 36% rate until 400,000 but getting rid of the payroll tax cut.

The lowest income earner could earn 110k or more. Then the payroll tax cut saves 4400 a year. Thus that couple would have to make more than 372,222.22 before they would save money under the Obama compromise.

Now this ends up being a quadrilateral on any graph since those points only serve as boundaries. But many of the people in that quad would be better off with the payroll tax cut as would lower income people.

[Indydem]

1. Yes, except the payroll tax cut is robbing the SS fund.

So yeah, if you want to keep doing that, then by all means...

[dsc]

3. It actually transfers from the general fund

to the SS fund which reverses the transfers that have already occurred. It seems a sensible way to pay back the ious. Undertax for SS while overtaxing for the general fund by raising rates on the wealthy, increasing the capital gains rate, and getting rid of the carried interest exemption.

[Indydem]

4. You can't do BOTH!

You can't raise those taxes and all the other crap they want to do under the guise of deficit reduction and then turn around and keep borrowing the money to keep a tax cut that hasn't really had any effect.

[dsc]

5. actually unemployment dropped considerably

during a period where that was the only stimulative policy on the books. That said, it might be wise to let the tax go but not if we aren't going to maximize collection from the wealthy.

[BeyondGeography]

2. The payroll tax cut was never meant to be permanent

[dsc]

6. kick