![]()
|
|
Jewish World Review March 30, 2012/ 7 Nissan, 5772 Twitchy Dems need to let workers put tax-cut money in retirement funds By Deroy Murdock
http://www.JewishWorldReview.com | The temporary payroll tax holiday that Americans are enjoying now looks like a full-time component of the U.S. economy. So, it might as well be put to better use. Congress should let payroll tax cut recipients place some or all of this money in voluntary personal retirement accounts. The payroll tax holiday was designed as a one-time measure to stimulate the drowsy economy. It reduced the individual portion of the Social Security tax from 6.2 percent of wages to 4.2 percent. Washington encouraged Americans to spend this money to increase aggregate demand and, thus, give the economy a badly needed kick in the rear. But a funny thing happened after one year. As the temporary holiday approached expiration, few in Congress or the White House wished to be seen as hiking taxes on working people. With votes on this matter scheduled around Christmas, who wanted to play Scrooge to the middle class? So, after some loud wrangling over amendments on the Keystone XL Pipeline and other matters, Congress voted to keep the payroll tax holiday alive for another year. At a total cost this year of roughly $112 billion, this adds up to about $700 in average tax relief for some 160 million workers. Most likely, this initiative now is a permanent part of the tax landscape. Having returned to the American people 2 percentage points of their Social Security taxes, Congress probably never will have the nerve to take this away. Like cement freshly poured from a Ready-Mix truck, temporary taxes have become as hard as a sidewalk. "Year after year, many of these 'temporary' tax cuts are extended," writes David Morris, a contributor with Engage America, a new organization that promotes fiscal responsibility and economic prosperity via social media. (I now am a Thought Leader with this group.) "Would you believe that not only are there more temporary tax cuts on the books today than in 1998, but that some of the tax cuts from 1998 are still part of the tax code? Believe it." (http://www.engageamerica.com/deficit_taxes/comments/No-such-thing-as-a-t...) Morris cites Scott Hodge, president of the Tax Foundation, who observes: "This is going to become permanent law...Once these things get built in, cooked in to the system, they're awfully difficult to get rid of.'" There is just one small problem with this tax cut: The money has been borrowed from the Social Security system. Imagine a city that takes money from its police pension fund, and then hands cops cash in hopes they will spend it in local stores. The federal payroll tax holiday operates on virtually the same basis. At some point, Washington is supposed to borrow money, most likely from China, to replace the funds. As it stands, any American can take his entire payroll tax cut and invest it in six packs of Schlitz, cartons of Marlboros, and state lottery tickets. Why not offer the option, say, to keep the suds and smokes but put the lottery money into a stock portfolio? Democrats get very twitchy when it comes to letting Americans invest their own Social Security money. So, Republicans should put them to the test: Since such accounts would be 100 percent voluntary, would Democrats actually vote to let Americans do anything with their tax cut money except salt it away for their golden years?
Every weekday JewishWorldReview.com publishes what many in in the media and Washington consider "must-reading". Sign up for the daily JWR update. It's free. Just click here. Comment by clicking here. Deroy Murdock is a columnist with Scripps Howard News Service and a media fellow with the Hoover Institution on War, Revolution and Peace at Stanford University.
• 03/23/12: Why not $100-an-hour minimum wage? • 03/15/12: The real (high) cost of Obama's health care act • 03/09/12: Race-baiting Dems oppose voter ID • 03/02/12: Forget kids --- today's debt hurts adults • 02/24/12: Dems arise against Obamacare • 02/17/12: The voting dead are understated • 02/10/12: Holder takes on 'racist' photo-ID cards: Prejudice is widespread --- even Obama backed them • 02/03/12: On tax plans, Gingrich trumps Romney • 01/27/12: Photo IDs can protect elections, let dead rest • 01/20/12: Romney runs hot and cold on global warming • 01/13/12: Economic freedom declines in U.S. • 01/06/12: Time to yank off Mitt's mask • 12/23/11: Boehner hands Dems a gift • 12/15/11: The U.S. could learn much from Hong Kong • 12/09/11:$687 billion is available to Congress free of strings • 12/02/11: Obama criticizes Wall Street but takes money from it • 11/18/11: Puerto Rico shows Washington the way • 11/11/11: Take heed, America: In Ohio even left-wing unionists voted to repeal ObamaCare • 10/28/11: Thanks, Netanyahu, for surge of hardened terrorists • 10/24/11:The Obama Spend-O-Rama • 10/17/11: Cain stakes his viable claim just by showing up • 10/07/11: Green jobs are national scandal • 10/04/11: Obama proudly declares class war • 09/23/11: Obama wrong about Do-Nothing Congress • 09/16/11: Obama needs Ryan's vision on jobs • 09/09/11: Reaganomics trounces Obamanomics • 09/02/11: Labor leaders to Obama: Stop killing jobs • 08/26/11: Pro-market Perry vaults over Romney in GOP race • 08/19/11: Some rich Americans will not rest until Washington boosts their taxes • 08/12/11: Hope, change and free birth control for all • 08/05/11: Debt deal does virtually nothing • 07/21/11: Dems pro-choice on abortion but little else • 07/15/11: Debt deception: If only Dems were honest and GOPers were courageous • 07/08/11: Congress' war on light bulb blows up
© 2011, SCRIPPS HOWARD NEWS SERVICE |
Columnists
Toons
Lifestyles |