December 21, 2011

"At this stage, Republicans would do best to cut their losses and find a way to extend the payroll holiday quickly."

Says the very nervous Wall Street Journal:
Then go home and return in January with a united House-Senate strategy that forces Democrats to make specific policy choices that highlight the differences between the parties on spending, taxes and regulation. Wisconsin freshman Senator Ron Johnson has been floating a useful agenda for such a strategy. The alternative is more chaotic retreat and the return of all-Democratic rule.

79 comments:

Larry J said...

The House Republicans should throw it back in the Democrats face. "We're trying to cut the payroll tax for 12 months but the Democrats only want to give you a 2 month cut."

Hammer them repeatedly until they cave or the Senate Republicans grow some balls.

pbAndjFellowRepublican said...

YoungGun?

traditionalguy said...

The Wall Street Journal guys are in fear of losing the cahnce at a Senate Majority, and perhaps the House Majority as well.

Their candidate named Romney does zero to dispel the image of the investors selling out the middle class by compromise after compromise with the Dems.

But they do fear The Tea Party saying no and losing some more RINO seats.

pbAndjFellowRepublican said...

"...but the Democrats only want to give you a 2 month cut."

Er....wouldn't it be helpful if the Senate Rs hadn't served up an 89 to 10 approval of the two month bill?

Doh!

garage mahal said...

The adults are trying to intervene.

Revenant said...

Sounds like hysterics to me. Democrats aren't going to re-take Congress in 2012.

Dust Bunny Queen said...

A two month payroll deduction cut is just plain bullshit.

First of all it is going to cause chaos in the payroll departments all over the country. Payroll is calculated on a quarterly basis. Software programs all over will have to be recalibrated and updated.

It will COST businesses more to implement the stupid policy than it would save.

Two months is spit in the big picture of US deficits and means doodly squat to both the employee and to the employer. It is hardly the amount per paycheck to buy a decent pizza and a six pack of beer.

The BIGGEST problem in a 12 month extension of a 2% deduction of payroll taxes and especially social security contributions is that it will further drive the SS funding into the tank.

However, I think that IS the goal of the Democrats and Obama. To break SS sooner than later and to not even TRY to fix the problem.

Unless a payroll deduction is FIRMLY tied to a jobs creation package like the pipeline and a losening of the stranglehold that Obama has put on the energy sector....the program would be a disaster.

Unless you can offset the drain on SS by lowering the contributions with more input by increasing jobs, the program is geared to do great harm to the system.

It is all just Kabuki theatre being played with our lives.

Original Mike said...

"The House Republicans should throw it back in the Democrats face. "We're trying to cut the payroll tax for 12 months but the Democrats only want to give you a 2 month cut.""

Exactly. What's the problem?

Bender said...

The Republican congressional leadership are unmitigated, totally incompetent, disasters.

They have had several months to pass the right bill. Pass the right bill following regular order, i.e. hearings on the legislation, input from everyone on the language, full debate, etc. Instead, once again, we have a backroom deal that is presented as an emergency that must be passed, now, now, now. Don't read it, don't debate it, just pass it!!!!!! No, you don't get any input as to what is in it, just do what your leaders tell you damn it!

Everything that is wrong and has been wrong with Congress, this leadership has fully embraced.

And then you have John Boehner, with all the political instincts of Bob Michel and all the passion of Tom Daschle. What a moron.

They should simply take up the Senate bill, amend it to 12 months, include the same other provisions that were in the House bill that the House passed and the Senate rejected (with nary a peep of protest by Boehner, et al.) and then LOUDLY proclaim to the world that they have passed a 12-month bill, which is exactly what Obama had demanded just a couple weeks ago.

Better yet, instead of underfunding Social Security by cutting contributions, they should actually INCREASE the FICA tax by three percent, while cutting income taxes across the board by three percent. That increases funding for Social Security, decreases the amount available for Congress to waste on other spending, and keeps the total taxation burden the same as it is now.

edutcher said...

Have to agree with Revenant. This won't change the composition of Congress by itself, but Larry is right.

The House Republicans need to show the idea of a two month cut is ridiculous.

garage mahal said...

The adults are trying to intervene.

They've been trying to intervene all along, but the Senate and the Administration are playing politics as usual.

Original Mike said...

I heard an account on the radio this morning who claimed most payroll systems aren't going to be able to handle a cut shorter than one quarter. Two months? What a bunch of clowns.

Seeing Red said...

If the president was concerned, he wouldn't be on a 17 day vacation. Make Congress work thru the holiday.

Original Mike said...

Oops. DBQ beat me to it.

Dust Bunny Queen said...

Oops. DBQ beat me to it.

I'm doing payroll now for our little S Corp. My husband and I are the only 'employees'. What a freaking pain in the butt!!!

I can't imagine the chaos in a big company with hundreds and even thousands of employees.

Congress is full of buffoons and people that have no contact with the realities of running a business.

SunnyJ said...

Good to see a nod to our new R Senator Ron Johnson. He's been doing a very good job on budget concerns and just missed VP of the R caucus...which as a freshman says quite a bit about the reputation he is building. I've followed his actions and comments and he is bringing serious work ethic and business expertise to the table...as well, as the appearance of a measured but strong demeanor. He's no bomb thrower, but he will cut you off at the knees if you don't have your facts in order.

Dust Bunny Queen said...

Better yet, instead of underfunding Social Security by cutting contributions, they should actually INCREASE the FICA tax by three percent, while cutting income taxes across the board by three percent. That increases funding for Social Security, decreases the amount available for Congress to waste on other spending, and keeps the total taxation burden the same as it is now.


I approve this message.

Tyrone Slothrop said...

I have always approved of Boehner, but it looks to me that on this he's doing a terrible job. How else can you explain that 89-10 Senate vote? Does Boehner even communicate with McConnell?

mccullough said...

They should extend it for 5 years.

AJ Lynch said...

A two month payroll tax rate change shows how out of touch the Senate members are. The IRS would not even be able to figure out if companies paid the correct amount. Because payroll reporting is done on a quarterly basis. Any halfway experienced businessman knows that. But 100 senators obviously do not have a clue!

AJ Lynch said...

Sorry DBQ- I see now you had already pointed out how f-ing dumb our Congress critters are!

Mark B said...

@Tyrone: "I have always approved of Boehner, but it looks to me that on this he's doing a terrible job. How else can you explain that 89-10 Senate vote? Does Boehner even communicate with McConnell?"

i don't think it's Boehner's problem; more likely McConnell's.

The House passed the right bill already (12 months with offsets to "pay" for it). The Senate can pass it. Take it, or leave it.

America's Politico said...

GOP: Merry Christmas Mr. POTUS!

Obama: Mt. Rushmore here I come. Re-elected by the biggest margin ever.

THANK YOU: House Republicans.

The bonus to POTUS: GOP ticket - Newt/Perry.

The bonus to my consultancy: A corner office in WH and regular dates with the hottie from WH.

Original Mike said...

Whatever happened to Social Security taxes being for Social Security? This is the angle the Repubs should be pushing.

MayBee said...

You know that saying "Even if a lion could speak, you wouldn't understand him"?

That's how I feel when people say this situation is good for Obama.

Eric said...

The adults are trying to intervene.

Yeah, but as usual the Democrats are balking.

Dust Bunny Queen said...

Whatever happened to Social Security taxes being for Social Security? This is the angle the Repubs should be pushing.

It is my understanding that Social Security is a 'contribution' and not a tax. (Just semantics, I suppose, since we are forced to pay it no matter what)

The original idea was that you contributed to the SS Fund and when you were ready to retire or collect that is was then your own money paid back out in the form of an annuity.

Of course, we know how things in the Government morph from one intent to become Frankenstein monsters that bear no resemblance to the original intent.

edutcher said...

Original Mike said...

Whatever happened to Social Security taxes being for Social Security? This is the angle the Repubs should be pushing.

FICA has gone into the general fund since the Demos plundered it to pay for the Great Society (maybe even further back than that), but if the Republicans say anything in that direction, the Demos crank up the hysteria.

You look at the numbers and, one way or another, Social Security was always a scam.

I think now, finally, enough people are wising up to make a difference.

mccullough said...

They should extend it for 5 years.

Even the Communists realized you needed five years or so to plan your economy.

T J Sawyer said...

To see just what a mess the Senate version of a two-month extension is, just Google "Payroll tax 18350" and follow a few of the links.

When I saw what the senate had done, I laughed so hard I cried. What a bunch of idiots. Couldn't they have at least consulted with their own payroll department?

Glad I'm retired and not dealing with it.

Eric said...

It is my understanding that Social Security is a 'contribution' and not a tax. (Just semantics, I suppose, since we are forced to pay it no matter what)

That's true in political terms, but I wonder if it can be true as a legal matter. Didn't the entire debate around the constitutionality of the Obamacare mandate revolve around whether or not it's a tax?

shiloh said...

Cry me a river ...

Michael K said...

First of all it is going to cause chaos in the payroll departments all over the country. Payroll is calculated on a quarterly basis. Software programs all over will have to be recalibrated and updated.

Only a political party whose members have never run any sort of business could do this. George McGovern, a decent man, firgure it out too late

Rick said...

Weren't the democrats willing to work into the holidays to pass Obamacare?

bagoh20 said...

Even when everyone wants a tax cut they still find a way to make fight out of it.

Somebody is playing games, or lying as we call it in Rubeville.

Dust Bunny Queen said...

@ Michael K

Awesome article. Every Sentator, Congressman, Mayor....every public official should be forced to be a CEO or CFO of a small business for 5 years before being allowed to be in office.

Even if the forcing is in an internship capacity.

Walk a mile in my effing shoes you morons!! (Directed at Congress....and liberals who have starry eyed ideals about captialism). Face reality before you try to make idiotic rules with no thought of the consequences.

edutcher said...

Eric said...

It is my understanding that Social Security is a 'contribution' and not a tax. (Just semantics, I suppose, since we are forced to pay it no matter what)

That's true in political terms, but I wonder if it can be true as a legal matter. Didn't the entire debate around the constitutionality of the Obamacare mandate revolve around whether or not it's a tax?


Social Security is a contribution in the same sense the IRS relies on voluntary compliance.

FWIW, the word, "tax" appears in the original Social Security Act 38 times.

bagoh20 said...

So what does it mean if you say you are for cutting a tax, but only for two months?

Does that mean it's good, but so good 2 months is enough to fix the problem, or it's bad, but you want to do it anyway?

BarryD said...

Is anyone paying attention, other than the wonk/junkie set?

jeff said...

The reason they want to cut SS tax rather than a income tax cut is they can't cut taxes any other way for the 46% that don't pay income tax. So any other tax cut will just generate more complaints of tax cuts paid (somehow) on the backs of the poor. I'm not sure how they cut this tax and still keep the pretense that SS is still completely self funded.

Levi Starks said...

They should raise everybody's taxes enough for 2 months to keep the deficit at zero for those two months.
It's time we come to grip with just how out of control our spending is.
And if you haven't figured out put a little money in the bank in case of this kind of emergency you'll have an opportunity to find out just how screwed you really are.
But don't worry you'll find out soon enough anyway.

Dust Bunny Queen said...

And if you haven't figured out put a little money in the bank in case of this kind of emergency you'll have an opportunity to find out just how screwed you really are.


Given that MF Global seems to have been given the green light to just raid the accounts of those customers who had actual, real tangible gold, I don't think your money is safe in the bank or even the items in your safe deposit box secure from seizure.

FDIC is a joke.

bagoh20 said...

DBQ,

If you had a bunch of cash, where would you put it:

Pay down debt?
Bank deposit?
Buy real estate?
Gold?
Stocks/Bonds
Mattress?
Donate to the IRS?

Joe said...

I don't get the logic of how having House should cave to the Senate demands will a united strategy that will force democrats to then cave to the Republicans. This is loony.

The only way you get any sort of appearances of being united is through a reconciliation bill which only happens when one side doesn't go along with the other.

If anything, this highlights the idiocy of passing temporary measures and just how obscene and craven playing with the tax code has become.

ricpic said...

Hey, Obama's a Dem, so no big deal depleting Social Security. Because Dems love the people, all the people, especially the old people, right?...RIGHT?!

AJ Lynch said...

DBQ:

I too am interested in what recommendations you have in response to Bago's question.

Bender said...

Buy real estate?
__________

You don't buy (or own) real estate. You only lease it from the government, having to pay rent in the form of property taxes.

Patrick said...

If I get a $50 paycut the first check in Jan. Obama will have bought my vote.

Conservative voter

Patrick said...

bagoh20 cash today should be real estate.

Patrick said...

the other patrick is not me . I was just too drunk to be original in choosing a unique name.

Methadras said...

Republicans are the worst messagers on earth. You guys are fucking yourselves in the ass while the democrats take pics and put it on the net.

Methadras said...

Patrick said...

If I get a $50 paycut the first check in Jan. Obama will have bought my vote.

Conservative voter


All it takes is $50 to buy your vote? Aim high padawan.

wv = murse = something you can buy with you $50 savings to help your image go off better.

bagoh20 said...

"bagoh20 cash today should be real estate."

I agree that is the safest, and probably best investment right now, but it's also the most work to own.

America's Politico said...

Just had a late conference call with operatives from WH, DNC, CAP, and Congress about the payroll tax. The WH is victorious, even when the action is by GOP. There was champagne flowing and now am headed home after a night-cap of Irish whiskey. The biggest re-election margin of victory. Even I - the best consultant in DC - did not imagine the depth and breadth of the GOP help to the POTUS. This is even bigger than Newt/Perry. A thousand thank yous.

bagoh20 said...

I saw on TV that Republicans are gonna put coal in our socks. I think that is wrong to do.

Democrat Voter

Dust Bunny Queen said...

If you had a bunch of cash, where would you put it:

Pay down debt?
Bank deposit?
Buy real estate?
Gold?
Stocks/Bonds
Mattress?
Donate to the IRS?


Assuming the worst case scenario:

Gold and silver: small coins and bars. Cash backed by a bankrupt country is worthless.

Ammo and guns

Real Estate: although owning doesn't mean much in a worst case scenario but if you have real estate you can be somewhat self sufficient

Basically hard assets that can be traded for commodities

Commodities...you can't eat gold.

Assuming just a major crash/depression: best case scenario.

Pay down debt on those assets that could be repossessed. Screw the credit cards. Bite me.

Hard assets like gold, silver, jewelry.

Real estate. It will eventually go up in value and the market is reaching bottom soon. Buy at the bottom. Real estate can be somewhat of an income stream. Probably the best investment at this time. It is on sale. But, maintenance can be a problem for rentals. Possibly bare land at fire sale prices on the edges of suburbs and urban areas where there would be future growth.

Cash in the mattress..not the bank.

Commodities to hedge against the inevitable inflation.

Screw the IRS.

Alex said...

As usual the incompetent GOP snatches defeat from the jaws of victory. Of course that really means the American people lose.

Dust Bunny Queen said...

Ok to be more serious instead of apocalyptic and excessively pessimistic.

Bonds, which are debts are not likely to be good unless you have a very very good company. In addition bonds right now, even in good credit quality companies, have really low interest rates. When interest rates inevitably go up, the market value of your bond is going to tank and your income stream is going to be worse than new issue bonds.

Inverse relationship between bond market value and rising interest rates. I would avoid bonds unless you plan to hold for 10 years or more or if you only want the income. Only buy bonds from companies you think will be there in the future. Munis....forget it until they get the pension monkey off of their backs.

Plus, you have to wait for quite some time to recoup your principal in bonds when they are under water.

Stocks in companies that have products that people use and want on a daily basis and which have a history of paying dividends.....meaning that they are actually making profits, could be attractive. Food, drugs, household products.....things that aren't fads and that aren't luxury items.

Companies that are in sectors that should experience growth are also interesting. Oil, gas, commodities. Once we get Obama and the retarded Democrats out of the way, those companies should experience significant growth.

In the past I might have recommended hedging the dollar against foreign currency, but with the global instability....I just don't know. Hire a really good international expert if that is they way you want to go. That market is changing so fast...and it is like quicksand. What was glittering a few years ago... BRIC....is not so stable now.

Every day I thank my lucky stars that I retired last year.

Plus now that I'm retired, I can actually express my opinion. Take that...SEC!

bagoh20 said...

Any electorate stupid enough to buy that Obama and the Dems are tax cutters deserve them both.

The election is a long way off and this current tax cut crap is gonna be a completely different story by then.

Unless the Dems really want to out conservative the Repubs, in which case I say great - let's scrimmage over there in your end zone.

bagoh20 said...

I appreciate all that DBQ.

I sold all my stocks last year when things were pretty good.

I invested by buying my own company, which is doing fantastic. In fact we hired 6 people yesterday and are starting a second shift.

I've been buying rental real estate in Florida, but I hate the work, worry and bookkeeping of it, even though it's been quite profitable. It really is like a liquidation sale right now in some places, so it's hard not to win there.

I have plenty of both cash and debt. I borrowed a lot because money has been so cheap. I could pay that down, but worry that if I need it later it will be way too expensive to get. It seems smart to me to borrow when money is cheap and pay it down when it gets expensive and the money is worth less.

The problem I think a lot of lucky people like me have is: what do you do with cash. Expected inflation plus low returns makes money in the bank seem less safe than my mattress, well at least less than my pitbull's mattress.

bagoh20 said...

I have found some good things to do with cash: spend it and give it away. Both feel really good. Actually I'm not good at spending it, I was raised too frugal to enjoy it, but giving it away is absolutely fabulous. Except for one kind: This year I will write checks to CA and IRS that are the biggest checks I've ever written in my life. When I think of the good I could do with that money and realize where it is going instead, I get ill.

traditionalguy said...

The point that WSJ is making is not who is right and who has the best reason to stand up to the Obamanation. That is never going to be heard over the drumbeat of The Actor in Chief accusing the GOP of hoarding money due to the under $120,000 folks and refusing higher marginal rates on the over $1,000,000 folks.

That is called optics...false but effective.

After the way Romney has trashed Gingrich for two weeks with false but effective optics, maybe Karma is setting in.

Bender said...

if you have real estate you can be somewhat self sufficient

My parents own their house outright. Mortgage paid off. Like many seniors.

And they can't afford to live in the house.

That's right -- the house is fully paid for, and they can't afford it. The house is fully paid for, and it is costing them too much money. Their fully paid house is bleeding them dry financially.

Ralph L said...

Bender, they could get a reverse mortgage.

When I think of the good I could do with that money and realize where it is going instead, I get ill.
If everyone had to pay his taxes by check once a year, or even once a quarter, there would be revolution.

I think the point of the 2 month cut was that it forces them to fix things early next year, or get shat on by every payroll dept in the country. Of course, the uncertainty is no good.

Cedarford said...

Dust Bunny Queen said...
Better yet, instead of underfunding Social Security by cutting contributions, they should actually INCREASE the FICA tax by three percent, while cutting income taxes across the board by three percent. That increases funding for Social Security, decreases the amount available for Congress to waste on other spending, and keeps the total taxation burden the same as it is now.


I approve this message
===========================
More tax cuts for the wealthy, while an increase in taxes for low income people.
Less progressive taxes, more regressive ones!
Hell of a message "Party of the Rich" if Republicans went for it.

We are cutting income taxes on the John Galts, Hollywood types, and the jobs-creating "Doer Folk" of Wall Street, and High Finance, - And paying for those big fat income tax cuts on the rich with a payroll tax increase on cashiers, restaurant workers, middle class teachers,cops, engineers ..all the little people that never reach the FICA cap. Vote for us!

David said...

Larry J said...
The House Republicans should throw it back in the Democrats face. "We're trying to cut the payroll tax for 12 months but the Democrats only want to give you a 2 month cut."


They are already saying that. But the media is not exactly reporting it that way.

David said...

garage mahal said...
"The adults are trying to intervene."

They are called voters. The intervention will come in November, not before.

Ralph L said...

while an increase in taxes for low income people.
Merely preparing them for what will happen when the bulk of the boomers really start drawing on Medicare and SS. Just the leading edge is now, and they're both in the red.

My step-mother went on Medicare in April and has already squandered tens of thousands of your money, having spent millions of my father's.

T J Sawyer said...

The National Payroll Reporting Consortium seems considerably less amused by the senate's $18,350 bright idea than I was.

Of course, they have to deal with it, I only get to watch.

David said...

Bagoh, your cash is being taxed--a stealth wealth tax, a first for the USA. The interest rate you get is essentially zero, and inflation is reducing the value of the cash. This is happening because the fed feels it must keep interest rates low so that the banks and the government do not go belly up.

At an inflation rate of 2.5% you lose 5% of your cash's value to government financial manipulation every two years. You will lose more if inflation rates go up. You could buy 10 year treasuries (now yielding somewhat less than 2%) and make that up, but if interest rates increase you lose a lot more in the diminished value of your bonds.

If you don't need the cash for your business, keep it liquid and plan for the worst case. That means limited exposure to real estate. There may be bargains but it can be hard to dispose of in bad times. Investment real estate no more than 10-20$ of financial assets with little or no leverage.

Buy dividend paying US stocks on the dips. Look for companies that have steady dividend growth over a long time horizon. Buy some gold. Then buy some more gold--coins or bullion etfs. Gold may not outperform high quality stocks in the very long run, but it will be nice to have some if the shit really hits the fan, as it well could.

Most people recommend only 1-5% of financial assets in gold. I believe that 20% is more like the right number. You have to ask yourself, "what should I own when the U.S. Treasury starts having trouble selling it's bonds?" The only serious answer is gold.

But mostly attend to your business. You have more control over that than anything else.

Good luck.

Ralph L said...

a stealth wealth tax, a first for the USA.
You don't remember the 70's inflation and bracket creep?

Also, people will again have to pay capital gains tax on non-real, inflationary rises in asset prices (even on actual losses in value).

What will happen when all those trillions of newly-created cash start sloshing around?

Jay said...

Patrick said...

If I get a $50 paycut the first check in Jan. Obama will have bought my vote.

Conservative voter


Yeah. I bet.

America's Politico said...

Just had a morning call with other super K-street consultants.

Our message today through day after Christmas is this:

POTUS is for middle-class voters, the GOP is not.
POTUS cares for people. GOP does not care.
POTUS is an All-American. GOP is anything but.

The re-election is in the BAG. Thanks to the GOP. You are simply, without any doubt, the best thing that has happened to the White House, DNC, Center for American Progress, etc. etc. Please never ever change. Sounds okay, GOP?

Don't Tread 2012 said...

Um, amazing, this writing...optics aside, where is the perspective???

The dem congress sat on their hands for 2 years+ and offered no budget - yet they passed what is arguably the most expensive, partisan tax increase disguised as a health care bill in this nation's history.

And the WSJ whines about the repubs trying to get an extension of one year for a measly 2% payroll hit for everyone?

This is such small potatoes compared to everything else.

Yawn.

Don't Tread 2012 said...

@America's Pathetico

You and the WSJ can go pound sand.

Michael said...

People given a quiz on this matter in July will answer that the Dems were the culprits. You cannot overestimate the public's short attention span. You also cannot overestimate the hubris of Dems who score a faux victory as tax cutters. Their crowing will be a constant reminder of their propensity to tax and spend, their lust for taxes, their hatred of success.

Joe Schmoe said...

Those obstructionist Tea Party congressfolk are at it again. Imagine the temerity to try to enact the will of the people who voted them into office. What gall.

The sad thing to me is how institutionalized this farkakte system has become, even with the WSJ! Everybody twiddles their thumbs for months and then just when a deadline comes they run around like chickens with their heads cut off trying to pass a crappy bill. And then if you say "whoa, let's think about this for a second", you get branded as an obstructionist. Hence we get bullshit like "you have to pass it to find out what's in it".

We've had months and years to reform spending, yet it always comes down to these Chinese fire drills and it needs to stop. (no offense meant to Chinese)

Scott M said...

(no offense meant to Chinese)

Why no offense? If you design a poorly executed fire drill, you deserve as much ridicule as the Polish one-armed waving tree climber.

Thorley Winston said...

The reason they want to cut SS tax rather than a income tax cut is they can't cut taxes any other way for the 46% that don't pay income tax. So any other tax cut will just generate more complaints of tax cuts paid (somehow) on the backs of the poor. I'm not sure how they cut this tax and still keep the pretense that SS is still completely self funded.

Bingo, one of the Social Security trustees (a Democrat) made that exact point that by pushing for a payroll tax cut at a time when Social Security is paying out more in benefits than it collects in FICA, they’ve basically exposed it for what it is – just another welfare program. Once that sinks other reforms like means-testing and phasing in a higher retirement age could become more politically palatable.

I’m opposed to cutting the payroll tax without a proportional cut in future benefits so we can avoid increasing Social Security’s unfunded liabilities even further. If this is supposed to be Keynesian economic stimulus, then the two of them need to be tied together (people forget that Keynes advocated short-term deficits as a tool for priming the pump but always said that you needed deficit reduction or surpluses when times were good). Personally I’m not a fan of “stimulus” policies but if our politicians are insisting on that route, they ought to be doing the responsible and less popular portion of it as well.

This is basically an attempt to bribe voters with their own money and has nothing to do with job creation. No employer in their right mind is going to hire someone based on such a small and short term incentive even if they do it for a year and keep renewing it. A two-month extension though is worse because of the additional compliance costs it creates.

IMO if the Republicans have resigned themselves to renewing the payroll tax cut they should (a) stick with a year (b) tie it spending cuts (preferable a proportional decrease in benefits) and (c) ratchet up rather than ratchet down the things that might actually create incentives. The next time Harry Reid sends them a bill, add on the REINS Act as well as the pipeline project.

Dust Bunny Queen said...

Dust Bunny Queen said...
Better yet, instead of underfunding Social Security by cutting contributions, they should actually INCREASE the FICA tax by three percent, while cutting income taxes across the board by three percent. That increases funding for Social Security, decreases the amount available for Congress to waste on other spending, and keeps the total taxation burden the same as it is now.


I approve this message
===========================
More tax cuts for the wealthy, while an increase in taxes for low income people.
Less progressive taxes, more regressive ones!
Hell of a message "Party of the Rich" if Republicans went for it.


Oh...BullSHIT.

First of all discern the difference between Wealthy and High Income earners. Until everyone stops ignorantly confusing the terms, there is nothing to discuss.

Income taxes and FICA taxes are two different things. There IS a cap on the SS component of the FICA taxes but not on the Medicare component. So even the highest earners pay a considerable amount in FICA.

High earnings does not always equal wealthy. It is a way to get there, but it isn't a guarantee.

The high earners pay in MORE than they will ever EVER in their lives get back through SS.... even with the cap. At the same time, other people pay in nothing or very little and get the most back based on their contribution. As a matter of moral fairness, why should some people be FORCED to pay more to subsidize others who won't and don't pay in. The "Wealthy" could do much better by just putting their "contribution" into a passbook savings account.

Income taxes paid by the "Wealthy" are a combination of Earned Income and Unearned income. Passive income and capital gains, and a lot of tax strategies and tax breaks.

Deal with that and quit confusing the issues.

Issob Morocco said...

What the fuck does the WSJ Editorial Board know?

They are as bold and strong of spine as vanilla ice cream melted.

Hold out. When your opponent starts to tell you how it will hurt you, think the opposite. Remember they are the opposition and they want you to fail.

So if they want it, don't give it to them.

We are just ensuring FICA runs out of monies sooner by doing this Potemkin Village tax cut. Bush was right on that front in 2005 to change it.

Holiday Cheers!