Day after day this last month, Obama touts the importance of his "Payroll Tax Cut" and how deeply it will impact the working class and/or middle class. He is allowed to give speeches without media criticism of this plan. The "Payroll Tax" is the Social Security Tax, and a bipartisan commission in 1982 established a plan to fund Social Security into the future. President Reagan agreed to this tax hike which raised the OASDI rate to 6.2% for both the employer and the employee. The funds raised by this tax are to be used to fund Social Security. In the early years, a giant surplus fund was to be created which would alleviate the big hit that would be taken when the Baby Boom generation began to retire.
President Obama's plan cuts the dedicated funding source for Social Security with his scheme to cut the combined OASDI rate in half, from 12.4% to 6.2%. Why has the media not shouted with outrage that the Senior Citizens are in danger?
Perhaps the funding mechanism for Social Security should be discussed, but Obama doesn't dare bother to propose a reformation of the plan, he just throws out a supposedly temporary "payroll tax cut." Now the Social Security funds will have to be found amongst all of the other competing programs and departments in the federal budget.
Worst of all is that this is all the President has in terms of an economic plan for this country. No one seriously believes that a temporary one year payroll tax cut will lead to a vibrant and growing economy.
For further reading on this issue, check out the AP story written soon after the proposal was unveiled. The media did indeed cover the issue when it was proposed, but lately all I hear from hourly news updates are clips from an Obama speech demanding the immediate passage of this vitally "important tax cut for the middle class."
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