Medicare, Social Security Fix Not Easy

[editec]

Clearly the fix for dealing with the aged and invalids is to put the old and infirmed onto ice flows and let them drift out to sea.

And we'd better get to it soon because I'm informed that all the ice is melting.

 

[auditor0007]

As usual, the wealthy don't pay their share. And they'll raise hell if they are asked to pay the same rate as the poor.

The only way I could support this is if there was one flat tax rate for all. The wealthy already pay the highest rates, and now you want to add another 12.5% to their rate? That is the net result when combining employer contribution. In addition to that, you would effectively reduce their salaries as employers would reduce their salaries by the amount of their share of the tax.

By doing this, big income earners would pay combined total taxes of around 60%. I'm not one of those large income earners, but even I think that is more than makes sense.

I agree that is too much. The problem is that the wealthy hide money. Send it offshore. It's a constant game of cat and mouse to try and get the share of taxes they owe. As they find loop holes and send money offshore, we have to raise taxes on what they can't hide in order to try and get close to them paying what they actually owe.

And alas, that what keeps bringing me back a flat, across the board, tax. If we taxed all earnings at the same rate for everyone with a large exemption on initial income, we would have a fair tax that is progressive, lower in marginal rate, and payable by all, especially the wealthy. One same rate for wages, capital gains, inheritance, and corporate taxes, with no loopholes. The only exception I would make to this is a discounted rate for long term capital gains, as much of those gains are just inflated dollars.

 

[auditor0007]

ss is an easy fix to add to the suggestions already made here, they will need to raise the retirement age. medicare is another story.

Raising the age for SS and Medicare is an absolute necessity and must be part of the solution. The sooner everyone begins to understand this, the sooner it can be done.

 

[Oddball]

Oh? I thought they were "pyramid schemes." Has WorldNutDaily recommended a new label?

If you actually knew everything, rather than merely acting like it, you'd know that the terms are interchangeable.

 

[auditor0007]

Removing the SS cap on earnings is totally fair. The additional 6.2% paid by the employer on employees is the cost of doing business. Since the self employed currently pay 12.4% SS, consider the employers additional portion as the cost of having someone do the work for you.

When the employer pays the tax, it reduces the wages of the worker, plain and simple. It is still a tax on the worker, not the employer. It is a cost of doing business, but it is part of payroll as it is not a tax on earnings. That is why I laugh when some people suggest that lower income earners don't pay taxes, because they do pay FICA, and that is what is eating up one third of the federal budget and will eventually eat up much more if we don't make some changes. Basically, it is just a transfer of who is cutting the check on those taxes, but it still comes from the employee. So removing the cap would, in reality, be an additional 12.5% tax on the high income earner.

 

[Oddball]

Pay as you go is not the same as a Ponzi scheme. However, you are correct if the payout is less in real dollars than what was paid in or if the payout exceeds the capacity of those paying in. This is why the biggest part of a solution must come from a reduction in benefits.

Those scams haven't been pay-as-you-go for decades.

You cannot leave a big pile of money laying around, without politicians using it to buy votes.....And that's why those two hustles will never be fixed before there's a currency collapse.

 

[auditor0007]

I see it everyday:
Wealthy business owners on Medicaid with no medical history. (not sure how they pulled that one off)
People who live in million dollar mansions, retired, and have Medicare. (something is wrong with that picture.).

Physicians have been prosecuted for using medicaid benefits.

How is this happening? And if one retires a multi-millionare, do they really need social security or medicare benefits? No conscience.

Actually, yes they do, and here is the reason. Insurance companies are in the business of making money. They couldn't make the premiums high enough on those over 65 to cover the cost of care and turn a profit. And this gets back to the entire notion that health insurance through private insurers is a good thing and the best way to go.

Here is what would happen to those people without Medicare; the insurers would choose not to cover them, because it would not be profitable. Now you can say that is not an issue since they have a few million in the assets anyway. But what happens when they become seriously ill, which they will before they die? Or maybe they'll become seriously ill, but not die, and be left with nothing. It would work the way Medicaid works. You spend through all of your assets until you have lost all of your wealth, and then you go on Medicaid and live in a government run nursing home until you die. So all you worked for your entire life is gone, and the government still ends up footing the tab anyway.

I seriously don't think many people understand how expensive medical care is for those who are sick. I lost my wife to leukemia. For ten months of fighting for her life, the combined medical bills topped $1.3 million. Had she survived longer, who knows how much more it would have cost. This is why I don't have an issue with the Medicare tax being raised. That part of FICA has no cap, so the wealthy pay on their entire earnings.

 

[plt42]

...It is a cost of doing business, but it is part of payroll as it is not a tax on earnings.

So removing the cap would, in reality, be an additional 12.5% tax on the high income earner.

I must disagree. Simply put... the employee's 6.2% of gross is a liability to the company (the company is acting as a tax collector). The additional 6.2% is a company expense on the chart of accounts. That being the case, I don't see how you arrive at removing the cap as an additional 12.5% on the higher wage earner.

 

[justabubba]

...It is a cost of doing business, but it is part of payroll as it is not a tax on earnings.

So removing the cap would, in reality, be an additional 12.5% tax on the high income earner.

I must disagree. Simply put... the employee's 6.2% of gross is a liability to the company (the company is acting as a tax collector). The additional 6.2% is a company expense on the chart of accounts. That being the case, I don't see how you arrive at removing the cap as an additional 12.5% on the higher wage earner.

the employer would pay a 6.2% matching the contribution of the employee
if that amount is not paid over to social security then it can - and is - instead paid to the employee as compensation

but that argument deflects from the underlying point that this is presently structured as a very regressive tax. the wage earner pays tax on the first dollar. the high income earner has a cap ... despite being in a much better financial position to contribute to the social security system. the question was how to fix the social security system. the answer is to eliminate the cap on the amount subject to social security contributions
no means testing is required
no reduction of social security benefits is required
no increase of the age of eligibility to draw social security is required
all that is needed to make the social security system solvent is to eliminate the cap

 

[jreeves]

the ss fix is simple

just remove the cap ($106,800) on taxable income

each $1,000,000 in income will generate $124,000 in social security revenue which would otherwise not been paid
that person earning $10 million should not benefit from the $1,226,757 which would otherwise be due without an income ceiling

the low income individuals pay from their first dollar. there is no reason to exempt high earners from paying on their complete incomes ... especially recognizing that they enjoy the greatest ss payments upon retirement


medicare's fix is not so simple. it is incumbent on the nation moving to a universal healthcare system, to fold in veterans care, medicare and medicaid to make it solvent - hopefully a single payer system will evolve

Removing the SS cap will only prolong the invetiable failure of SS. Also, by eliminating the cap, SS will become nothing more than another welfare program. The people making over 107,000 will be forced to finance another program in which they receive no further benefit but have a higher withdrawl from their incomes. Great idea...
Bill Clinton was even against eliminating the cap for the very same reason.

 

[jreeves]

Clearly the fix for dealing with the aged and invalids is to put the old and infirmed onto ice flows and let them drift out to sea.

And we'd better get to it soon because I'm informed that all the ice is melting.

Actually the poverty rate among the aged is less than it is in the general population.

 

[auditor0007]

...It is a cost of doing business, but it is part of payroll as it is not a tax on earnings.

So removing the cap would, in reality, be an additional 12.5% tax on the high income earner.

I must disagree. Simply put... the employee's 6.2% of gross is a liability to the company (the company is acting as a tax collector). The additional 6.2% is a company expense on the chart of accounts. That being the case, I don't see how you arrive at removing the cap as an additional 12.5% on the higher wage earner.

Well, as an employer, albeit a small one, I consider it a part of overall payroll, plain and simple. Whether it is me or the employee paying it doesn't make a difference. If the employee had to pay the entire amount, then I would just increase wages by the difference. So in the end, it's a tax on the employee.

 

[auditor0007]

the ss fix is simple

just remove the cap ($106,800) on taxable income

each $1,000,000 in income will generate $124,000 in social security revenue which would otherwise not been paid
that person earning $10 million should not benefit from the $1,226,757 which would otherwise be due without an income ceiling

the low income individuals pay from their first dollar. there is no reason to exempt high earners from paying on their complete incomes ... especially recognizing that they enjoy the greatest ss payments upon retirement


medicare's fix is not so simple. it is incumbent on the nation moving to a universal healthcare system, to fold in veterans care, medicare and medicaid to make it solvent - hopefully a single payer system will evolve

Removing the SS cap will only prolong the invetiable failure of SS. Also, by eliminating the cap, SS will become nothing more than another welfare program. The people making over 107,000 will be forced to finance another program in which they receive no further benefit but have a higher withdrawl from their incomes. Great idea...
Bill Clinton was even against eliminating the cap for the very same reason.

While I believe SS can survive by reducing benefits, I agree. When SS was first instituted, no one envisioned people living into their 80's and 90's as a whole. It was meant as a supplement to retirement for a few years, not fifteen to thirty years.

 

[sealybobo]

the ss fix is simple

just remove the cap ($106,800) on taxable income

each $1,000,000 in income will generate $124,000 in social security revenue which would otherwise not been paid
that person earning $10 million should not benefit from the $1,226,757 which would otherwise be due without an income ceiling

the low income individuals pay from their first dollar. there is no reason to exempt high earners from paying on their complete incomes ... especially recognizing that they enjoy the greatest ss payments upon retirement


medicare's fix is not so simple. it is incumbent on the nation moving to a universal healthcare system, to fold in veterans care, medicare and medicaid to make it solvent - hopefully a single payer system will evolve

Removing the SS cap will only prolong the invetiable failure of SS. Also, by eliminating the cap, SS will become nothing more than another welfare program. The people making over 107,000 will be forced to finance another program in which they receive no further benefit but have a higher withdrawl from their incomes. Great idea...
Bill Clinton was even against eliminating the cap for the very same reason.

While I believe SS can survive by reducing benefits, I agree. When SS was first instituted, no one envisioned people living into their 80's and 90's as a whole. It was meant as a supplement to retirement for a few years, not fifteen to thirty years.

Tax soda's and junk food that kills people and have that money go into the SS pool.

 

[jreeves]

Removing the SS cap will only prolong the invetiable failure of SS. Also, by eliminating the cap, SS will become nothing more than another welfare program. The people making over 107,000 will be forced to finance another program in which they receive no further benefit but have a higher withdrawl from their incomes. Great idea...
Bill Clinton was even against eliminating the cap for the very same reason.

While I believe SS can survive by reducing benefits, I agree. When SS was first instituted, no one envisioned people living into their 80's and 90's as a whole. It was meant as a supplement to retirement for a few years, not fifteen to thirty years.

Tax soda's and junk food that kills people and have that money go into the SS pool.

Again no matter what taxes you can envision imposing on the general population to support the growing majority. It will only prolong the inevitiable failure of SS. Just for the simple fact that there is more people taking than there is paying. It really isn't rocket science, really...

 

[Oddball]

Again no matter what taxes you can envision imposing on the general population to support the growing majority. It will only prolong the inevitiable failure of SS. Just for the simple fact that there is more people taking than there is paying. It really isn't rocket science, really...

Exactly correct.

The Socialist Insecurity Ponzi scheme will never outrun its demographic unsustainability.

 

[Tech_Esq]

Medicare, Social Security Fix Not Easy
By TOM RAUM, AP
posted: 15 HOURS 25 MINUTES AGOPrintShareText SizeAAAWASHINGTON (May 24) -

There is no easy fix.
Medicare and Social Security will go broke sooner rather than later because of the recession. With millions of baby boomers beginning to leave the work force, the cost of these popular benefit programs threatens to swamp the government in debt in the coming years if nothing is done.
Congress and the White House are under increasing pressure to find a solution.
One proposal gaining steam is a creating bipartisan commission to tackle the approaching insolvency of the government's three big "entitlement" programs: Social Security, Medicare and Medicaid.
Everything would be on the table, including tax increases and benefit cuts. The commission would produce a "grand bargain" package of recommendations that Congress could accept or reject in total.

Medicare, Social Security Fix Not Easy - AOL Money & Finance

While the solutions for fixing these programs are not for the faint of heart, it would be nice to see our elected representatives, in a bipartisan effort, actually begin to work on finding a solution. These three programs are the biggest challenge facing the Federal Government, and it is time to finally address them as being the most important issues that we now face. There is no doubt that the final solution will have to involve a reduction of benefits as well as some type of tax increase. Reduction of benefits is the easy part, as that can be accomplished in most part by raising the age at which everyone begins to receive benefits. Raising taxes is a bit more problematic, but it will also certainly prove necessary. Limiting any tax increase though, is key. Raising taxes cannot be the sole solution. The bulk of the solution must come with a reduction in benefits.

Whatever the final solution, the most important issue is that discussion begins and that Dems and Republicans actually work on this in a manner that leads to developing real answers, and not pie in the sky lies that will leave future generations holding the bag.

If we must maintain these systems, then let's look at what Roosevelt must have intended when he put the system into effect.

Social Security was set to go into effect when a person reached 65. If we look back to the 1930s when the system went into effect, we will see that the average life expectancy for white males was 65. Shocker.

So, the answer is obvious. Index the social security retirement to the life expectancy. If you are only paying for less than half the people who have ever paid into the system, your system will be solvent.

Then the only questions are:
1) How do you patch the system while the index occurs?
2) What will older people do for work while they wait to be 85?

 

[editec]

Clearly the fix for dealing with the aged and invalids is to put the old and infirmed onto ice flows and let them drift out to sea.

And we'd better get to it soon because I'm informed that all the ice is melting.

Actually the poverty rate among the aged is less than it is in the general population.

Yes, thanks to social security, it is.

But I wasn't suggesting that we only send off the poor aged. Send off the rich ones, too.

Their scions will appreciate not having to wait so long for their inheritances.

We owe it to the children to snuff their grandparents ASAP.

 

[editec]

Removing the SS cap will only prolong the invetiable failure of SS. Also, by eliminating the cap, SS will become nothing more than another welfare program. The people making over 107,000 will be forced to finance another program in which they receive no further benefit but have a higher withdrawl from their incomes. Great idea...
Bill Clinton was even against eliminating the cap for the very same reason.

While I believe SS can survive by reducing benefits, I agree. When SS was first instituted, no one envisioned people living into their 80's and 90's as a whole. It was meant as a supplement to retirement for a few years, not fifteen to thirty years.

Tax soda's and junk food that kills people and have that money go into the SS pool.

Conversely we could insist that people eat nothing but junk food that kills people hence cutting down the number of people who survive till retirement.

You owe it to the children to eat that twinkie.

 

[Oddball]

Yes, thanks to social security, it is.

That post hoc ergo propter hoc dog don't hunt.