I'm a bit slow, but now I realize why there's so much resistance to raising the cap on SS

[BWdem4life]

(thanks to jaxexpat):

https://www.democraticunderground.com/100217630454

It's because EMPLOYERS would have to MATCH those additional contributions.

Employers don't even think they should have to match anything already, and they are behind the efforts to kill SS altogether.

Employers are behind the shift to "gig" drivers who are really employees, paying self-employment taxes of 15.2% while the employer pays NOTHING for both SS AND medicare.

So,

It's the EMPLOYERS, stupid!

[2naSalit]

1. K&R

[CousinIT]

2. US Chamber represents big business in the US. It's them and others.

The billionaires + big profit, non-tax-paying corprats. US Chamber lobbies US gov't on their behalf. Along with ALEC, Koch Bros and other huge RW outfits, they push HARD on Republicans and pay them handsomely via campaign contributions and under the table to cut, gut, abolish, or privatize Social Security & Medicare. They HATE it.

[overleft]

4. Everything nasty going on with the repugs has corporate money behind it!

The rich bastards simply do not like paying their fair share to society.

[karynnj]

3. Might be the promise not to raise taxes for people with income under $400,000.

This would increase the FICA taxes with incomes between the cap and $400,000. I understand the logic that some in very high cost areas think $400,000 is not super wealthy.

Another reason is that just as there is a cap on contributions, there is a cap on benefits. It might be that there is some connection between the two ... ie the benefit is determined by an algorithm based on contributions. If so, it might make things worse.

[Wounded Bear]

9. Yes, raising the cap would raise benefits on upper income folks as well...

It's still not a good excuse not to do it.

[Fiendish Thingy]

18. As the law is currently written, lifting the cap would not increase the maximum benefit. Nt

[machoneman]

25. True. Further, if the cap were raised to $1 miilion, SS would NEVER run out of money per an expert..

..report I read a few years ago. Since it's a percentage of income, the rich person (and the firm they work for or own) would pay a lot more into the fund and, with the cap on max. payout, the fund's top line would increase dramatically.

[El Mimbreno]

43. So simple, so sensible...

so the corporate-owned repubs will never buy it.

[Wounded Bear]

26. OK, that was not my understanding, but I'm not a tax attorney...nt

[Rebl2]

41. Agreed

[LiberalFighter]

5. Very good. Personally, I consider what the employer pays as part of our wages.

[Trailrider1951]

13. Absolutely! Especially since pensions are long gone and many employers

don't even match a % of 401K contributions these days. I'm convinced that too many "job creators" would bring back slavery if they could!

[thesquanderer]

21. Employers also consider it part of wages...

...which means that lifting the cap is essentially a demand that they give all those people a wage increase. Though really, do companies really have tons of employees making that kind of money?

[BlueCheeseAgain]

6. Could they raise the cap without requiring employers to match the extra?

[BWdem4life]

8. Politics is the art of the possible

So sure, it's possible. It would also be possible to reduce the rates for everyone while raising the cap only for individuals.

But, considering Republicans (and employers who lobby them) want to destroy the program altogether and are using fictional stories about its insolvency to help achieve that end, how likely is it that they would go along with any plan that increases funding for SS?

[SYFROYH]

7. That and individuals don't want to pay more unless they receive more.

[relayerbob]

12. Um, you've got cause and effect reversed here

You receive more when you put more in. The OP is 100% correct that the employers don't want to pay more, as it comes out of their profits.

[SYFROYH]

35. You get more if you pay more up to a point.

There is a max benefit.

[stopdiggin]

20. individual retirees are receiving FAR in excess

of their own contributions. So - from a strictly financial point, that argument doesn't hold water.

(on an 'emotional' level you could have some handle on what people 'want' - but that doesn't make it plausible. and I want a pony and a golden puppy while we're at it.)

[SYFROYH]

37. Maybe, but if they pay more they don't get more, do they?

[stopdiggin]

40. why should they?

if they are already receiving far more than they put in? I'm trying to understand - what it is that we are not understanding ...
----- -----

[mopinko]

10. it's complicated. it's a basic, limited program. it rly needs to stay that.

you have to 1 of 2 things if you scrap the cap-
break the link btn payments and benefits
or scrap the max benefit
teddy kennedy hated this idea, and sorry, so do i.

a much better way to go is to include capital gains. not everyone who lives on gains is rich, w self perpetuating money. many would be grateful for the check when they’re old, and the survivors/disability if they need it.
could be at a lower level, ie not required to make up the employer portion, like self employed do. and a lower bennie.

personally, i’ve long thought that ppl should be able to make voluntary contributions. if you dont make the max, you can ask to be taxed more, and maybe your employer has to match that.
that way lower wage workers can still get max bennies.
be taxed all yr at 1/52 of the max tax, regardless of your wages. planned savings.

[relayerbob]

11. Yep

I'm very opposed to this "gig" economy, where employers basically can do whatever they want, simply by calling employees "contractors".

[TygrBright]

14. Yup. That's always been the motivating force behind the "kill it!" gang. n/t

[Peacetrain]

15. If a company is paying its higher ups say 400,000.. they can afford to pay their share of the SS..

(just pulling a number out of thin air for an example) Corporations skim by paying nothing at all in many cases.. so yep it is the corporations also, among other things

[Fiendish Thingy]

16. It's also because the maximum benefits wouldn't increase

So, folks who already hit the annual cap would see their withholding increase, but unless the new legislation to lift the cap also increased the maximum benefit, they would be paying more, and getting no increase in benefits.

So, it’s not just the employers, it’s the highly paid employees who would balk at lifting the cap.

[thesquanderer]

19. Yes, but the highly paid employers have a lot more political clout than the highly paid employees do

[Fiendish Thingy]

22. For many of them, their objection isn't to lifting the cap

They resent having to pay into SS, period.

Killing SS altogether would be far more lucrative to many employers, as well as Wall St.

[wiggs]

24. Many reasons why they don't like it as a govt program (even though it has been one of the

most successful govt programs in history, and has reduced crushing poverty among older americans). But another primary one is that any time there's a pot of money, GOP donors want it...thus the push to privatize. Not because it will result in better safety nets and higher quality of life for many in retirement...but because there's profit to be made. The self-funding SS fund is huge.

I'm sure the GOP, freshly butt-hurt from the SOTU speech, are trying to publicly say they won't 'cut' SS...but privately they want to 'fix' SS by privatizing it.

[fescuerescue]

29. If we increased the maximum benefit, which would be fair

I think most people would be perfectly fine with uncapping it.

I think the pushback, is by keeping the benefit cap and uncapping the contribution, it's just another tax program and not a benefit program.

But employers side contributions are already uncapped and have been for years.

[Fiendish Thingy]

32. If the max benefit were increased, it would reduce the benefit of lifting the cap

Possibly even eliminate any benefit to extending solvency of the SS fund by lifting the cap

[fescuerescue]

39. Certainly is possible.

or maybe it would still help at a reduced level, but actually make it possible to pass. (better than no help and no pass)

Generally more money flowing in means that more money will also NEVER payout because some will pass away early.

Id love to see the math on that.

Even If it became net even in terms of stabilizing the fund, getting all the wealthy invested into SS MIGHT be a good thing overall.

Imagine a billionaire paying hundreds of millions into the SS system and receiving 6 figure $1m monthly checks. I bet he would be invested in keeping it stable.

Right now it's seen by the controlling class as a misery welfare program. Getting that class onboard could have it's benefits.

[onecaliberal]

17. K&R

[The Jungle 1]

23. Yes I agree

What a lot of folks get wrong is calling it an employer contribution.
The money the employer pays is earned money! I earned that money.

[DallasNE]

30. Employer SS-Medicare Tax

Is also a big driver for companies taking jobs overseas. They just deplore all kinds of taxes.

[ymetca]

36. All the stress on the system

is because the last of the baby boomers (like me) are currently pressing hard on the funds.

Heck, a large percentage of us have become so physically and mentally damaged by work and jobs, so broken by our labor, that we barely make it to retirement now.

My parents got a LOT less out of Social Security and Medicare than THEIR parents. And we are getting even less. This slow whittling away of our supposed 'birthright' (i.e. working since I was 12) has been choreographed by GREED.

We're the surviving human wreckage of the Reagan/Thatcher trickle-down theory of economics, aka Voodoo economics, aided and abetted by Clintonian 'triangulation', in deregulating the financial system, etc., --all sold to us as some sort of modernizing streamlining and improvement.

Made up bullshit to cover for writing laws allowing their campaign donors carte blanche in sticking their snouts into the public trough and siphoning off every last nickel.

[Kaleva]

42. It isn't a birthright

In the 1935 Act, Congress explicitly reserved the right to change it modify social security as they saw fit. SCOTUS has upheld that view.


"Congress clearly had no such limitation in mind when crafting the law. Section 1104 of the 1935 Act, entitled "RESERVATION OF POWER," specifically said: "The right to alter, amend, or repeal any provision of this Act is hereby reserved to the Congress." Even so, some have thought that this reservation was in some way unconstitutional. This is the issue finally settled by Flemming v. Nestor....

In its ruling, the Court rejected this argument and established the principle that entitlement to Social Security benefits is not contractual right.."

https://www.ssa.gov/history/nestor.html

[dlk]

44. If a business can afford to pay salaries over $160,200

They can afford additional FICA tax.