Fiscal Cliff Math: am I doing this right?

[JayhawkSD]

15. Yes, you have it wrong. You are not comparing apples to apples.

Both Tammy Teacher and Bobby Banker are paying 6.2% of their income into a trust fund for retirement. Both had a temporary hiatus on almost 1/3 of that contribution, which is now ending. In neither case will that affect their retirement, because the government made the amount they did not pay. Bobby Banker pays more in because he has a higher income. No, he doesn't pay on the entirety of his income because, as has been pointed out, he receives retirement funding based on what he paid in and there is a cap on the benefits he can receive. The reason Babby Banker doesn't pay in based on the entirety of his income is that his payments into the system would be excessivebecause of that benefits cap. So, although the tax appears regressive, it is actually not. The benefits received are proportional to the amount paid in.

Tammy Teacher's taxes are not going to go up at all. They are completely unaffected by this deal. As mentioned arlier, the forgiveness she had earlier on paying into her retirement does end, but the amount she pays for the operation of her nation's government is unchanged.

Bobby Banker's taxes will increase on $100,000 of his income. The forgiveness he had earlier on paying into his retirement ends, and the amount he pays for the operation of his nation's government will increase.