Social Security is in no danger of being weakened by a payroll tax holiday.

[ProSense]

that is fully paid for (edited title and to add this for clarification).

The MSM is pushing this line, but as Dean Baker points out it's "untrue"

CPBB Presient Robert Greenstein on the payroll tax holiday and other aspects of the President's proposal.

The MSM wants to keep the idea alive that Social Security is being weakened. It's pure fear mongering.

There is a case to be made, as Greenstein did, for the payroll tax holiday.

Robert Kuttner proposed this in September 2010:

<...>

Six. Propose a six month tax holiday for payroll taxes. Ask for the Republicans' support. This would provide direct tax relief to working people and lower the cost of creating jobs. It would provide more of a tonic to the economy and more practical help to American families than any of the Republicans' proposed tax cuts. Make up the loss to the Social Security trust funds with a temporary surtax on people making over $10 million a year.

<...>

Nouriel Roubini also suggested this last September:

<...>

A much better option is for the administration to reduce the payroll tax for two years. The reduced labor costs would lead employers to hire more; for employees, the increased take-home pay would boost much-needed economic consumption and advance the still-crucial process of deleveraging households (paying down credit card debt and other legacies of the easy-credit years).

Most policy approaches, including the Obama proposals, have tended to subsidize the demand for capital rather than the demand for labor. That has the problem backward. In the second quarter, capital spending reached an annual growth rate of 25 percent. The argument that increased demand for capital leads to greater demand for labor (i.e., if you buy more machines you need workers to run them) has not held up. Firms are investing in capital goods, equipment and offshore offices that allow them to produce the same amount of goods with less -- and lower labor costs. To avoid a chronic increase in the unemployment rate, we need to subsidize the demand for labor -- achieving job creation -- rather than making it cheaper to buy capital, as investment and other tax credits would do.

President Obama could fully fund the reduction in payroll tax by allowing the Bush tax cuts for people making more than $250,000 a year to expire. Meanwhile, the Bush-era cuts affecting middle- and low-income earners -- the vast majority of Americans -- would remain in place for the time being.

<...>

Kuttner suggested replenishing the trust fund with a temporary surtax on the rich. Roubini suggested the tax holiday be paid for by letting the Bush tax cuts for those earning more than $250,000 expire.

President Obama proposed ending oil subsidies, closing corporate loopholes and the Bush tax cuts for the rich (millionaires), which will have a long-term impact on revenues as opposed to a temporary surtax.

[madfloridian]

1. Finish telling what Kuttner proposed.

"Make up the loss to the Social Security trust funds with a temporary surtax on people making over $10 million a year."

That is not what Obama is proposing...he wants to turn it over into the general revenue fund. Big difference.

[ProSense]

4. Hmmmm?

"Finish telling what Kuttner proposed."

From the OP: Kuttner suggested replenishing the trust fund with a temporary surtax on the rich. Roubini suggested the tax holiday be paid for by letting the Bush tax cuts for those earning more than $250,000 expire.

President Obama proposed ending oil subsidies, closing corporate loopholes and the Bush tax cuts for the rich (millionaires), which will have a long-term impact on revenues as opposed to a temporary surtax.

[Curmudgeoness]

2. Well, there is the tax holiday, but not

a surcharge on the wealthy. Not an end to the Bush tax cuts. No ending subsidies or closing loopholes.

So, where is the money coming from to pay for this holiday? I have been looking for the answer to this question for about a week now and find nothing that is definitive.

[ProSense]

5. It's

"Well, there is the tax holiday, but not a surcharge on the wealthy. Not an end to the Bush tax cuts. No ending subsidies or closing loopholes.

So, where is the money coming from to pay for this holiday? I have been looking for the answer to this question for about a week now and find nothing that is definitive."

...really interesting, in the face of the OP information, to see the objection to this become how it's paid for.

From the OP: Kuttner suggested replenishing the trust fund with a temporary surtax on the rich. Roubini suggested the tax holiday be paid for by letting the Bush tax cuts for those earning more than $250,000 expire.

President Obama proposed ending oil subsidies, closing corporate loopholes and the Bush tax cuts for the rich (millionaires), which will have a long-term impact on revenues as opposed to a temporary surtax.

[Curmudgeoness]

6. Yes, I read that the first time. Suggested, proposed,

but what happened. I am not saying that I am afraid that this will destroy Social Security (there are many other things that worry me on that front), but I find it interesting that we have the tax holiday, but we do not seem to have the means to pay for it---yet.



Edit for my misspeak. Mind is going in too many directions today.
:blush:

[laugle]

8. BINGO!!

"Talk is cheap, it's deeds that matter"

[ProSense]

11. It's

Suggested, proposed, but what happened. I am not saying that I am afraid that this will destroy Medicare (there are many other things that worry me on that front), but I find it interesting that we have the tax holiday, but we do not seem to have the means to pay for it---yet.

...not Medicare, it's Social Security, and it's still paid for. Funds have been allocated.

The fact that the Republicans are demanding that this be paid for while insisting that we can't afford it is the reason the President proposed ending subsidies to the oil companies and tax cuts for the rich.

[quiller4]

7. From a transfer from general funds just as in the current "holiday"

[NorthCarolina]

9. Is there inherent danger in tying Social Security to the General Fund? nt

[madfloridian]

10. Yes.

[NorthCarolina]

12. Actually, I think that in itself might be the real goal here. nt

[ProSense]

13. No.

Social Security is not touched. The money goes in.

There is a danger to Social Security from Republicans, but this is not it.

[bornskeptic]

24. So you'd think about giving up some of your SS benefits because part come from the general fund?

How about your Medicare benefits? Of course Part A is paid for with payroll taxes until the trust fund runs out, but Part B is 75% funded from the general fund, as is Part D to a large extent. I haven't heard anyone offering to give up their Medicare for that reason. Everything from Medicaid and Food Stamps to Oil Company subsidies and Nuclear weapons is paid for from the general fund. How would it be such a horrible thing if 25% of Social Security benefits were as well? Do you think we should eliminate Food Stamps, SSI, Medicaid and WIC because they are paid for out of the general fund? I've never in my life seen anything more bizarre than supposed liberals on a Democratic board arguing against a progressive tax policy because they are frightened of Republican talking points.

[Hoyt]

29. Shaking my head in disbelief too. Good points that people ought to read.

[creeksneakers2]

63. There have been transfers from the general fund to SS in the

past. SS is still here.

[texpatriot2004]

3. This is good food for thought. "Fearmongering" is the

standard these days eh.

[madfloridian]

14. They are depleting the funding source for SS....that is not "fearmongering".

I am tired of telling the truth and being called a fearmonger.

[texpatriot2004]

23. Um, all due respect, I did not call you a fearmonger I was

simply stating that fearmongering is a tactic frequently used in our time.

Peace.

[Major Hogwash]

25. You are flat out wrong.

If a gigantic jobs bill were passed, like the one FDR created, the WPA, the money would come out of the general budget.

But, not collecting payroll taxes on a temporary basis for new hires is NOT depleting any funds for Social Security.
The Social Security Trust Fund is solvent until 2037.

Without new hires, paying ANY payroll taxes!!

[madfloridian]

41. No, I am not.

Here is more:

"But what explains the headlong rush in Washington to use the current crisis to undermine the foundations of economic security even further?

Specifically, I'm talking about a new proposal to rob from Social Security to fund a continuing tax break for people who don't need Social Security — the wealthy.

Make no mistake: This is a bipartisan effort. It started back in December, when President Obama capitulated to the GOP on a budget deal by cutting the payroll tax, which funds Social Security. Advocates for the program pointed out then the shortcomings of this approach: It was targeted inefficiently and unfairly, skewing to the upper middle class and hurting lower-income families in comparison with the Making Work Pay tax credit it replaced.

Even more troubling, it blew a hole in the financing mechanism for Social Security by reducing payroll tax revenue by roughly $110 billion for the year. It was plain then, as it is now, that once you've cut a tax, it's ever harder to restore it."

http://articles.latimes.com/2011/jun/19/business/la-fi-hiltzik-20110619

More:

"The White House maintains that the $120 billion lost to Social Security's trust fund will be paid back by a transfer of general tax revenue, "ensuring no negative impact on Social Security solvency."

But clearly there will be new pressure on the available pool of general tax revenue, unless the $120 billion generates so many new jobs so fast that an army of newly employed workers fills the coffers of the Internal Revenue Service with unanticipated tax revenue. No one expects that to happen, at least not quickly.

So the government would have to borrow to make Social Security whole. That, in turn, would make the short-term deficit worse. So Congress might not vote to replenish the trust fund."

http://www.aarp.org/work/social-security/info-12-2010/social_security_what_the_payroll_tax_cut_means.html

[Major Hogwash]

42. Collecting 50% of payroll taxes from new hires is more than not collecting any new payroll taxes.

Like President Obama said, it's easy, it's just math.

Your links completely distort what President Obama said about it.
President Obama didn't say he was going to borrow to make Social Security whole.
That's what your 2nd link said.
Instead, he charged the Special Committee to come up with a way to include the costs of the American Jobs Act.
I guess you missed that part of President Obama's speech.

It's no wonder you peeps in Florida wound up with Rick Scott as a Governor if you're supposed to represent the smart Democrats from down there.

[ibegurpard]

15. nonsense

[ProSense]

17. Elaborate! n/t

[ibegurpard]

19. no

[OwnedByFerrets]

16. Fail

[ProSense]

18. Huh? n/t

[FrenchieCat]

20. Prosense.....Folks already have their talking points memorized and ready to go

and aren't accepting any new information at this time.

Like anything else, it's not about getting anything done,
it's about finding something not to like, and sticking
to that. It about poisoning the message from within.

Remember the health care debate? although it should have always been
about passing something to build on later on,
for many narrow minds it was about all or nothing.

That's why no one is actually willing to debate the merits of
those who believe that getting monies into people's pockets
is of bigger importance for the sake of the economy than
worrying that if this tax cut were to become permanent,
it might erode the SS fund. Of course, we could just lift the cap,
if we are wise enough to work hard to win the house and save the senate
for Democrats.

They "bah humbug" mentality reminds me of the Republicans who decided to worry more about long term deficit than the needs to cure the current recession.
This is the same kind of logic....Thee same sorta of shit.

[Curmudgeoness]

21. This has nothing to do with our talking points. If it were all about

getting more money in the pockets of the working people, that could have been accomplished by a 2% cut in income tax withholding. Or as was used in the past, tax rebate checks. There is nothing magical about the vehicle used to put money in pockets. But reducing taxes on FICA sets a precedent that the Repugs will use to bring down Social Security----and this is something that they make no bones about. They want it destroyed, and this just puts another chink in the armor of SS, feeding into how it is costing too much and is hurting the general fund savings that they are intent on doing.

Wait and watch. This is the first step in dismantling SS.

[ProSense]

22. This

" But reducing taxes on FICA sets a precedent that the Repugs will use to bring down Social Security"

...is really nonsense.

Republicans have been gunning for Social Security for decades. They don't need a excuse to attack it. Bush's privatization scheme and Ryan's plan came before the tax holiday.

Republicans aren't interested in a payroll tax holiday, they're interested in dismantling and privatizing Medicare and Social Security.

To claim that a payroll tax holiday give them impetus for this is nonsense.

GOP Reps. Dismiss Tax Cut For Working Americans In Favor Of Giveaways To Corporations

[bornskeptic]

27. If you collect it from income tax withholding low income workers have to wait

until they file their tax returns the next year, because they have little or no withholding. Defining it as a payroll tax cut puts the money intoo circulation faster, and grows the economy faster. Besides that people don't have to pay their tax preparer for the extra form as they did with the Making Work Pay credit.

[Curmudgeoness]

32. OK, I can see that. Thanks. nt

[Telly Savalas]

35. Moreover if you collected it from income tax witholding

the trolls would latch onto your argument as evidence that Obama is at war with working Americans. But because he didn't propose this, it of course is a superior alternative to the President's proposal.

There's simply no course of action he can take that won't result in knee-jerk feces flinging from the prolific posters here who hate the President.

[FrenchieCat]

34. Many don't pay income taxes.....especially the working poor.....

or didn't you know?

So it does have everything to do with getting money into folk's pockets ASAP.
You may not like it, but that is the case.

The first step in dismantling SS is to take the President down instead of his
opponents. Now, that will do it for sure.

[creeksneakers2]

64. What you advocate can't get money down to the bottom

of the ladder. Most people at the bottom don't pay income taxes, so any change in the rates or withholding won't benefit them at all. Rebates and tax credits are out because the GOP, who control the house, refuse to go along with them. They say they are welfare.

The only possible way to get money down to the workers is through an SS tax cut.

[Major Hogwash]

26. That may be true and I'm sure that some of them are watching the wrong channel

But, how are you doing?

Is there any news about your book?
Huh?
Is there?

Ha ha ha

[FrenchieCat]

36. I'm ok......

still working on my book. It will be some time still.
Glad you asked! :)

[flamingdem]

51. Good sumation Frenchie nt

[madfloridian]

28. Dean Baker was quoted above. In July he opposed the payroll tax cuts.

So let's talk about that article.

http://www.cepr.net/index.php/op-eds-&-columns/op-eds-&-columns/the-payroll-tax-cut-a-stimulus-that-progressives-should-oppose

"However, there is a serious political problem with tying the tax cut to Social Security. While the deal is that the trust fund will be unaffected by the tax cut, the question is what happens when the extension ends. Several Republicans in Congress have already publicly said that they would oppose restoring the payroll tax to its former level, since that would be a tax increase. And increasing taxes is the most deadly sin for many Republicans.

This raises the possibility that Republicans will try to keep the lower Social Security tax rate in place indefinitely. If there was a commitment to permanently replace the program’s shortfall with general revenue, the loss of the payroll tax revenue would not matter. However, there is no such commitment.

Obviously the Republicans want to reduce Social Security’s revenues so that they can turn the fictional Social Security crisis into a reality. If the program were to permanently lose the revenue from 2 percentage points of the payroll tax then Social Security would first face a shortfall in a bit more than a decade, rather than the quarter century of full solvency currently projected by the Trustees. And the size of the projected shortfall would be instantly doubled.

This scenario would not be a problem if President Obama had demonstrated a firm commitment to Social Security and indicated his willingness to go to the mat to protect the program. But he has done just the opposite. He has told the world that he is such a reasonable guy he is prepared to make major cuts to Social Security."

And another article which is critical of the payroll tax cuts.

http://blogs.reuters.com/reuters-money/2011/09/09/would-obamas-payroll-tax-cut-hurt-social-security/

"But Social Security advocates worry that these temporary payroll tax cuts will never be restored. “The problem is, it is very easy in our current political climate to cut revenue and very hard to increase it,” says Nancy Altman, co-director of the Strengthen Social Security coalition and author of The Battle for Social Security, an excellent history of the program and its politics.

“Look at the controversy over ending the Bush tax cuts, which would only affect a small portion of taxpayers,” Altman says. “In this case, if you propose restoring the payroll tax down the road, you’d have to double the rates on workers making minimum wage. This is being sold as temporary, but it’s not likely to work out that way.”

The current and proposed FICA tax cuts don’t directly affect the long-term health of Social Security, because the revenue that normally flows direct to the Social Security Trust Fund is being reimbursed out of general revenue. But that so-called “hold harmless” provision now gives Social Security a direct role in rising deficits for the first time. Up until now opponents have sought to tie the program to the deficit by arguing that the Social Security Trust Fund is just a collection of worthless IOUs, but those arguments don’t hold water.

The FICA tax may not be the ideal way to fund Social Security. As Altman notes, the tax is regressive in that it collects tax on the first dollar earned by workers, and is capped at $106,800 in income (See: Warren Buffett). But it’s an approach all sides have been able to live with from the program’s inception in the 1930s."

[kentuck]

30. Hmmmm?

:-)

[madfloridian]

39. .....

:)

[ProSense]

31. Hmmmm?

""However, there is a serious political problem with tying the tax cut to Social Security. While the deal is that the trust fund will be unaffected by the tax cut, the question is what happens when the extension ends. Several Republicans in Congress have already publicly said that they would oppose restoring the payroll tax to its former level, since that would be a tax increase. And increasing taxes is the most deadly sin for many Republicans."

The Payroll Tax Cut Did Not Cost Security Revenue

The NYT wrongly told readers that the payroll tax cut cost Social Security, "resulted in $67.2 billion of lost revenue for Social Security in 2011." This is not true. The tax cut was fully offset by money from general revenue so that the trust fund was unaffected by the tax cut.

Point is consistent: Payroll tax cut does not impact the trust fund.

[ProSense]

33. A couple more points from the first article:

<...>

This is important background because it seems that an extension of the payroll tax cut into 2012 is the most likely form of stimulus currently on the table in negotiations between President Obama and Congress. This would mean extending the 2 percentage point reduction in the employee side of the payroll tax for another year. If the current arrangement is left in place, the Social Security trust fund will be credited with an amount equal to the tax cut so that the program’s finances are left unaffected.

In principle, this would be a reasonable form of stimulus. The distribution of the tax cut is relatively progressive, albeit not as progressive as the Making Work Pay tax credit that it replaced. It gives workers a tax break equal to 2 percent of their wages up to the payroll cap of roughly $108,000. This means that the tax break going to Wall Street types will be no larger than what a senior firefighter might get.

Since most of the money will go to middle-income and low-income people, it is likely that a large portion will be spent. This makes it much better stimulus on a per-dollar basis than the extension of the Bush tax cuts.

<...>

[chill_wind]

37. Baker has opposed it, all said and done.

Whatever merits "in principle" not withstanding, his July piece title says it all.

The Payroll Tax Cut: A Stimulus That Progressives Should Oppose

http://www.cepr.net/index.php/op-eds-&-columns/op-eds-&-columns/the-payroll-tax-cut-a-stimulus-that-progressives-should-oppose

[ProSense]

45. No.

"Baker has opposed it, all said and done."

The point isn't whether or not Baker opposed it in July, the point is whether or not he believes the deal dismantles Social Security, and he does not. From the link:

<...>

In principle, this would be a reasonable form of stimulus. The distribution of the tax cut is relatively progressive, albeit not as progressive as the Making Work Pay tax credit that it replaced. It gives workers a tax break equal to 2 percent of their wages up to the payroll cap of roughly $108,000. This means that the tax break going to Wall Street types will be no larger than what a senior firefighter might get.

Since most of the money will go to middle-income and low-income people, it is likely that a large portion will be spent. This makes it much better stimulus on a per-dollar basis than the extension of the Bush tax cuts.

However, there is a serious political problem with tying the tax cut to Social Security. While the deal is that the trust fund will be unaffected by the tax cut, the question is what happens when the extension ends. Several Republicans in Congress have already publicly said that they would oppose restoring the payroll tax to its former level, since that would be a tax increase. And increasing taxes is the most deadly sin for many Republicans.

This raises the possibility that Republicans will try to keep the lower Social Security tax rate in place indefinitely. If there was a commitment to permanently replace the program’s shortfall with general revenue, the loss of the payroll tax revenue would not matter. However, there is no such commitment.

<...>

Baker acknowledges that "the trust fund will be unaffected by the tax cut."

He sees a "serious political problem," a hypothetical about what the Republicans might try to do. After Bush's attempts to privatize Social Security, Ryan's plan and "Cut, Cap and Balance," it's evident Republicans will try to dismantle Social Security. They are going to try to do it any way.

While Baker is concerned about a political consequence, he admits the payroll tax cut is "stimulus," its distribution "relatively progressive," and that its benefits mostly middle-income and low-income Americans.

[chill_wind]

49. Yes. "For this reason there should be no deal on a stimulus that involves a payroll tax cut."

For all the great argument "in principle", that is what he has said, bottom line. MY point stands.

There is a favorite canard from some on DU that economists are useless and irrelevant because "they don't understand politics." He's not one of them.

[ProSense]

50. It's still

fear of a hypothetical, which doesn't change the fact that Baker acknowledges that "the trust fund will be unaffected by the tax cut." It's also doesn't change the fact that he considers the payroll tax cut a "stimulus," its distribution "relatively progressive," and that its benefits mostly middle-income and low-income Americans.

So fear of Republicans is not a good reason to reject a stimulus.

[Vattel]

57. Baker does think that

there is a danger that payroll tax cuts would weaken SS. The danger he outlines is that Republicans will not allow the tax cut to expire, and worries about the deficit will be used to object to providing the necessary funds from general revenue to make up the resulting shortfall in the trust fund, thereby leading to more pressure to cut SS benefits. Yes, it's a fear of a hypothetical, but so what? Hypotheticals are very relevant to good decision-making. The real question is how likely it is that this hypothetical would actually come to pass if a payroll tax cut is institutued, and whether the benefits of the tax cut are worth the risk.

[Major Hogwash]

43. President Obama didn't tie the tax cut to Social Security. This article is bogus, dude.

I don't know how far you got in high school, but they must have been fast times.

LoL

[ProSense]

44. People are so

afraid of how the GOP might spin this that they'd rather ignore the advice of several economists.

Now that's fear.

[Major Hogwash]

46. That doesn't bother me that much.

What bothers me is that people posting here actually talk as if President Obama is stupid and hasn't hashed these things out already.

The President is a freakin' genius.
He acts as if he has played into the hands of the Republicans so many times in order to make them think they are winning, only to turn around and give them a proposal they supported themselves just a few years ago that has a few tweaks to it to make it a better idea!
The Republicans are shooting themselves in the foot on a daily basis.
It's incredible watching them put their own feet in their mouths, and then claim that President Obama doesn't want to reach across the aisle and compromise with them.

Senator Kerry was one of the first proponents of a temporary cut in the payroll taxes in order to help stimulate job growth years ago.
I mean, do people think that Senator Kerry is dumb?
Do they think he doesn't have their best interests at heart?

It just boggles my mind that anyone can accuse President Obama of not being pro-business.
Over half of his staff are from Wall Street companies for crying out loud!
But, to hear Senator McConnell tell it, President Obama doesn't want to create jobs, and has no plan to create them.

President Obama and Representative Pelosi and Senator Reid have set the Republicans in Congress up, they are like rats caught in a box.
The Republicans don't know what else to do, but run around and squeak!

[madfloridian]

53. They are cutting the funding source of SS. Then complaining there are problems with it.

Could you tell me how they will replenish the 110 to 120 billion we lost in funding for SS last year and in the years to come?

If it comes from general revenue...then it can be called part of the problems of the deficit.

[madfloridian]

52. This article was not about the speech. It was about the policy.

I am not a dude. I do not appreciate your insults throughout this thread toward me.

The article was pointing out the dangers of payroll tax cuts before the speech.

I don't think Obama is hearing all sides of things.

[Tarheel_Dem]

38. Thank You!

:dem:

[Name removed]

40. Deleted message

Message removed by moderator. Click here to review the message board rules.

[Fuddnik]

47. Unrec

Dis

[ProSense]

48. Boo!

Hiss!

[kelly1mm]

54. The big political problem with the payroll tax cut is losing the "SS doesn't add to the

deficit" talking point FOREVER. That was always a great point to those who claimed we could not afford SS in its present form. Yes, you are correct that the SS trust fund is being replenished from general revenues but in so doing, about 40% of those replenished funds are being borrowed. Maybe the 'cure' to making the SS trust fund whole may speed up its demise. I am not concerned about what R's will do, I am however dismayed that we have given up one of the best counter points to their rhetoric.

[ProSense]

55. Well

"The big political problem with the payroll tax cut is losing the "SS doesn't add to the deficit" talking point FOREVER."

...Social Security isn't adding to the deficit. The money is being replenished by the general fund, and all the provisions are paid for.

Given that Republicans and the media have consistently made the deficit argument, they're likely to continue doing so. Democrats and other will have to continue debunking them.

Why should anyone cede this argument to Republicans when it's inaccurate and given that other initiative (defense spending, tax cuts for the rich, etc.) they support do add to the deficit?

[kelly1mm]

56. How can we debunk them? 40% of general revenue is made up of borrowed

funds. Thus 40% of the general revenue funds going to replenish the SS trust fund are borrowed funds. Meaning that the SS trust fund is now, for them first time in history, adding to the deficit.

If you believe this is not the case, can you be specific in you objections?

[ProSense]

58. Well,

"40% of general revenue is made up of borrowed funds. Thus 40% of the general revenue funds going to replenish the SS trust fund are borrowed funds."

...it could come from the 60 percent not borrowed. What is it they like to say, "Money is fungible."

The fact is that replenishing Social Security is irrelevant to the program's structure in term of contributing to the deficit.

[kelly1mm]

59. OK, so I suppose Bush could argue that none of his wars added to the deficit

and that they were paid for with tax dollars rather than the borrowed dollars, right? Dollars are fungible, as you say, but that is usually an argument against the type of accounting trick you are trying to promote by saying the replacement dollars are coming only from non-borrowed funds (one could equally argue that the replacement funds came solely from borrowed funds).

[ProSense]

60. Do

"OK, so I suppose Bush could argue that none of his wars added to the deficit and that they were paid for with tax dollars rather than the borrowed dollars, right? "

...you think that's logical, comparing a $70 billion payroll tax holiday to $2 trillion wars?


As for the "fungible" argument, that's simply turning the GOP's claim back on them, and I was being sarcastic.

The fact is, the tax cuts are paid for, the Social Security fund is replenished, and spin about deficit or anything else is bogus.

[kelly1mm]

61. OK, so given our conversation, do you now admit that the great argument

saying "Social Security does not add one dime to the deficit" is no longer a true statement?

If not, could you explain why?

[ibegurpard]

62. give it up

the spin is strong with that one

[kelly1mm]

65. Yeah, I don't think a counter to my argument was in the talking points

memo sent out from HQ! Although I think those that spout the straight party line have their hearts in the right place, I also think their enthusiasm blinds them to other points of view. Additionally, when putting out factually incorrect statements in support of a good program/policy stance, the argument will turn towards the right debunking the statement and the left trying to defend it. When, as above, the statement is proven false, it taints the rest of the good points we may have been able to make in support of the policy.

In my opinion, keeping the SS funding stream 'pure', as in only from payroll tax receipts, and thus insulating it from attacks that it adds to the deficit, was paramount in being able to protect SS over the long haul. Well not really protecting SS from attacks, as the right would say that anyway, but at least those attacks were easily factually proven false, thus putting them on the defensive and tainting all their other arguments.

Others may think it was worth it. I just wish they would acknowledge the reality of the choices made.

[Vattel]

66. very well-said

[ProSense]

67. Hmmmm?

"Yeah, I don't think a counter to my argument was in the talking points memo sent out from HQ! Although I think those that spout the straight party line..."

Yeah, I'm sure that was what Dean Baker was doing.

So you want a counter to this: "do you now admit that the great argument saying "Social Security does not add one dime to the deficit" is no longer a true statement?

Why would I admit to a stupid point?

Let me repeat: The fact is that replenishing Social Security is irrelevant to the program's structure in term of contributing to the deficit.

[kelly1mm]

68. Is the statement "Social Security does not add one dime to the deficit" true or not? nt

[ProSense]

69. Why

"Is the statement "Social Security does not add one dime to the deficit" true or not.?"

...are you now going to be making that argument that it does?

I certainly am not because it's false. It's Republican spin.


Here's why the fear mongering is silly, it requires a hypothetical scenario in which Republicans continue it permanently.

Why Extending Payroll Tax Cuts Makes Social Security's Future More Uncertain

Here's the problem with extending the payroll tax cuts: They're unlikely to ever be restored. And if they're not restored, you've done what Republicans have been trying to do for decades: turned Social Security into a welfare program that no longer pays for itself, but comes out of the general fund and for the first time, adds to the deficit.

So when you hear people saying it's a good idea for the economy, they're right -- for the short term. It's additional stimulus at a time when it's badly needed. But for the long run, it will politically undermine the long-term future of Social Security -- which the administration probably considers a feature, and not a bug:

<...>

The argument is basically don't implement an idea good for the economy, "badly need stimulus," because Republicans will likely do something negative in the future.

Republicans are going to attack Medicare and Social Security in the future anyway. Bush tried to privatize it (before the payroll tax holiday). House Republicans passed the Ryan plan and "Cut, Cap and Balance," and they're likely going to continue to push these plans.

"They're unlikely to ever be restored"

Fear mongering! The extension is for one year. Extending it would require a new bill. If Republicans have the power and the numbers to dismantle Social Security, they will likely go the route of Bush's scheme or Ryan's plan.

Why is there such concern about what Republicans might do...and in the future? Maybe it's time to stop hyping the flawed notion that Social Security is being jeopardize when it's not.

[kelly1mm]

70. If you re-read my comments in this thread you will see exactly why I think

this is a big deal and it has nothing to do with my fear of what R's will do. It has everything to do with our ability to counter what R's will do. There is a difference.

If, as you seem to admit, we are using in part (about 40%) borrowed funds to replenish the SS trust fund, how can you seriously say that the statement "Social security has not added one dime to the deficit" is still true?

[ProSense]

71. Now

"If you re-read my comments in this thread you will see exactly why I think this is a big deal and it has nothing to do with my fear of what R's will do. It has everything to do with our ability to counter what R's will do. There is a difference.

If, as you seem to admit, we are using in part (about 40%) borrowed funds to replenish the SS trust fund, how can you seriously say that the statement "Social security has not added one dime to the deficit" is still true? "

...you're talking in circles. Re-read my comments.

[kelly1mm]

72. I will try this one more time, with a question that only requires a yes or no answer,

with further clarification if one desires. It has nothing to do with Democratic or Republican talking points, just facts and a basic understanding of accounting.

Question: Does Social Security add one dime to the deficit?

My answer: Yes. Since the lost revenue to the SS trust fund from the payroll tax holiday is being replaced with funds from general revenue, of
which about 40% is borrowed funds and adds to the deficit/national debt, about 40% of the amount replaced is being added to the debt.

Your answer?????

[ProSense]

73. Well

"Question: Does Social Security add one dime to the deficit?

My answer: Yes."

...my answer is no. It's false. It's Republican spin, which is the answer I gave in post 69.

Still, feel free to continue making your argument if you think it will help to counter Republicans' efforts to dismantle the program.

[kelly1mm]

74. Since the point of your OP was that the losses to the SS trust fund from

the payroll tax holiday is being replaced by general fund revenues (and have been since the first 2% payroll tax holiday), and about 40% of general revenue is from borrowed funds, can you please explain exactly how you still claim that it is false that SS has added to the deficit?

If you have an explanation I would LOVE to hear it as I could use it to counter Repub points on this issue.

Maybe I an just not understanding what you have been saying and need it spelled out more clearly. I am not really interested if it is spin by the Democrats or Republicans, but rather what is factually true.

[ProSense]

75. Well,

"Maybe I an just not understanding what you have been saying and need it spelled out more clearly."

...the proposal will be paid for

Again, the fact is that replenishing Social Security is irrelevant to the program's structure in term of contributing to the deficit.

Social Security does not contribute to the deficit.

[kelly1mm]

76. How exactly is the CURRENT payroll tax holiday not adding to the debt? I admit

that the proposed EXPANSION of the payroll tax holiday has tax revenue proposed that would pay for it. Although I don't think those tax proposals would pass the congress. The CURRENT payroll tax holiday (2% off the employee side) has no such funding source.