Obama's payroll tax deduction will actually raise taxes on the poor

[brentspeak]

http://www.nytimes.com/2010/12/08/us/politics/08impact.html?_r=2&hp

In fact, the only groups likely to face a tax increase are those near the bottom of the income scale — individuals who make less than $20,000 and families with earnings below $40,000.

“It’s going to look like the rich are getting richer again,” said Anne Mathias, an analyst for MF Global Inc.

snip

Although the $120 billion payroll tax reduction offers nearly twice the tax savings of the credit it replaces, it will nonetheless lead to higher tax bills for individuals with incomes below $20,000 and families that make less than $40,000. That is because their payroll tax savings are less than the $400 or $800 they will lose from the Making Work Pay credit.

“It will come to a few dollars a week,” said Roberton Williams, an analyst at the nonpartisan Tax Policy Center, “but it is an increase.”

There's something else about Obama's payroll tax holiday: it may very well end up http://www.huffingtonpost.com/rj-eskow/obamas-tax-holiday-a-pois_b_793526.html">destroying Social Security.

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[jefferson_dem]

8. It's like they want to pit this deal against some mythical legislation that doesn't exist.

Like comparing the healthcare reform deal against single payer, which was a non-starter from the start.

Folks, reality calls.

[ProSense]

2. The Making Work Pay credit expires at the end of the year

It's interesting that no one admitted this was a good thing until this point. If the deal fails, the Making Work Pay credit still expires.

“It will come to a few dollars a week."

So a few dollars of $400 to $800 means it's a bad deal?

They should extend the Making Work Pay credit, but only a few people were making the case for extending the stimulus tax credits.

[Enrique]

3. damn

that's brutal. And they're going to pay further when the GOP starts cutting everything. Damn.

[dennis4868]

5. There's something else about Obama's payroll tax holiday: it may end up destroying Social security

Ezra Kein debunked this yesterday....need to find the link to it....he also debunked it on KO's show last night and you can tell KO was not happy about that because it went against his narrative....

[brentspeak]

6. He debunked nothing

Ezra Klein made the vague claim that if the "US fiscal house was merely in order", Social Security could survive with a 2% reduction in revenue. In other words, he's pushing his own narrative of cutting Social Security benefits drastically while raising the retirement age. Ezra Klein is what one calls a "corporate liberal", and should not be considered an expert on much of anything.

[dennis4868]

9. yep....

just because he does not fit your "narrative" he is not an expert...these are crazy times at DU!

[Sherman A1]

7. If we end up with the knucklehead idea, I

will be putting that money into my 401k right away to both offset any potential tax on that money and to do what I can to have a few pennies for retirement, if we can ever get there.

[stray cat]

10. Not really - the break they were getting expired

lets keep facts straight so we are debating real choices

[rocktivity]

11. If Social Security needs money, raise the salary cap

Eliminate it altogether, and EVERYONE can pay a lower rate.

:headbang:
rocktivity