Social Security a Net Loss for those who make more than $65K per year

Discussion in 'Economy' started by boedicca, May 13, 2011.

  1. boedicca
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    boedicca Uppity Water Nymph Supporting Member

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    An interesting tidbit near the end of the article at the link:

    Today, anyone making more than $65K per year will receive less in benefits than they pay in SS taxes (and this is before reform).

    If any factoid makes a stark case for privatizing SS along a Chilean style model, this does. How disgraceful that a middle income person should pay into an (Orwellian) retirement income insurance fund with absolutely No Return on Investment.

    [i\Here is additional data put together by Andrew Biggs at the American Enterprise Institute. He looks at the “net tax rate” for Social Security — that is, the statutory 12.4 percent Social Security tax paid by workers minus the benefits they receive from the program. A negative net tax means that the people in the quintile receive on average more benefits than they pay in taxes in the course of their lives. A positive net tax means that less benefits are received than taxes are paid.

    The table shows that the two top quintiles paid more in taxes than they receive in benefits. Based on income distribution data from the Tax Policy Center, for 2008 (most recent IRS data) the second quintile begins at cash income of $18,725; the middle quintile at $37,257; the fourth quintile at $65,634; the 80th percentile at $110,346. I suspect that very few people realize that anyone making above $65k pays more in Social Security taxes than they receive in benefits.[/i]

    Redistribution of Income: Not From the Rich to the Poor But From the Young to the Old - By Veronique de Rugy - The Corner - National Review Online
     
  2. Norman
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    Norman Gold Member

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    Why should anyone get return on taxpayer's back via retirement plan that invests nothing, and thus should give no returns?
     
  3. Trajan
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    Trajan conscientia mille testes

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    Yup, that WSJ article they reference is what I read and remarked on in Toros SS thread.


    here-

    this is how they get away with not giving a surviving spouse both payments, the survivors and the dead spouses, because it was " intended for the individual" account holder, but not for another individual even though they may have been married for years and that withholding effected them both equally in the shared domicile, this is, in the end, dishonest.
     
    Last edited: May 13, 2011

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how is tax figured on social security income if spouse make 65k