Just Scrap The Cap

Watch this. It’s hilarious, and has a lot of truth to impart. Text continues below the video (which is just a little over 3 minutes lont.

Senator Patty Murray (D-WA) is collecting signatures for a petition to “scrap the cap!”

Here’s what this means.

Some members of Congress want to cut Social Security benefits to pay for Wall Street’s greed. Even though 401(k)s were decimated by reckless bankers, home values have plummeted, and nest eggs are gone, conservative politicians defend a lower payroll tax rate for millionaires than what is paid by middle class families.

Social Security has a surplus of more than $2 trillion – enough to cover benefits for 25 years or more. It is fully funded by the payroll contributions of American workers; it doesn’t contribute a dime to the nation’s deficit. And now more than ever, Social Security benefits are critical to more than 50 million Americans who rely on them.

Instead of cutting benefits or raising the retirement age, our elected leaders should protect working class families and “Just Scrap the Cap”.

What’s “the cap”?

Right now, everyone pays Social Security taxes only on the first $106,800 they earn, which means most people pay Social Security taxes on their whole paycheck. But after $106,800, no contribution is made to Social Security – so a whole lot of wealthy people don’t pay a dime in Social Security taxes on most of what they make. That’s “the cap”.

Social Security could pay full benefits forever if millionaires simply paid the same Social Security tax rate as most other people do. Heck, we could even afford to improve benefits a bit.

But unless we tell Congress to “Just Scrap the Cap,” they could cut Social Security benefits instead.

Please sign this petition to tell Congress – tell them: No cuts to benefits, and Scrap the Cap! To reach the petition, please go to Just Scrap The Cap.

Effect of “Scrapping The Cap”

The Congressional Budget Office (CBO) is a federal agency within the legislative branch of the United States government. It is a government agency that provides economic data to Congress. The CBO was created as an independent nonpartisan agency by the Congressional Budget and Impoundment Control Act of 1974.

The CBO reported in July 2010 the effects of a series of policy options on Social Security’s “actuarial balance” shortfall, which over the 75 year horizon is approximately 0.6% of Gross Domestic Product (GDP.) The shortfall has increased from about .54% of GDP in the 6 years since 2004. There is a cost for delay. On a GDP of $14.5 trillion, this represents approximately $90 billion per year; the dollar amount would grow along with GDP.

One policy options that the CBO studied was to “Tax (At Current Rates) All Covered Earnings Above the Taxable Maximum; Do Not Increase Benefits.” The purpose of not increasing benefits is that over time, wealthy individuals who paid a lot of FICA taxes would qualify for truly enormous Social Security benefit amounts. This policy change would result in an increase to Social Security’s OASI trust fund of about 0.9%, which would entirely cover the shortfall into the foreseeable future and would result in some surplus besides, which could be used to improve benefits over what they are now.

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2 Responses to Just Scrap The Cap

  1. poppi panama says:

    I assumed without a doubt that this president was against what is prevalent when he campaigned against the middle and lower class Americans not being subjected to this chicanery. The war is over abroad in some places but the real war is here today and right now. The OWC war is overdue for notariety and this is good that finally the truth is being exploited about the facts and I did not even realize how horrific and devastating the virus and venom has become. GO OCW GO! We can not continue to act like a dumbfounded and a blind civilization with these oppressors. America wake up! Powers that be DO THE RIGHT THING for us please. We deserve to be treated with equality! More importantly, RESPECT!

    • ssapotluck says:

      Panama,

      Sorry I didn’t get back sooner. We went to the doctor and we are both fine. It was a regular check up, but we got flu shots and we are kind of under the weather.

      Thank you for your posts. I agree and I too hope the young man makes it. He has been terribly injured, though and it is the kind of injury that is very hard to treat. There are many veterans participating in this protest and they are very brave. They put their own bodies between the police and other protesters to try to keep the police from attacking those who are younger and weaker. Most of them if not all of them have seen combat and fought for this country and then they come home to no jobs and economic abuse because their benefits have been cut by the wealthy.

      Two days ago Congress was talking about stripping more benefits away from veterans. I wonder if they think that this young man has finally given enough or if they will treat him as if he is disposable like they treat other veterans. He fought bravely. I hope he doesn’t pay with his life.

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