Social Security Tax Cut Mute

We have to admit every once and a while Washington does something that really makes no sense but it helps my family so we stay mute. This is the case over the President Barack Obama plan to cut payroll taxes for a year. If you have not heard congress would cut the worker share of Social Security taxes by nearly one-third for 2011. Workers who are making $50,000 in wages would get a $1,000 tax cut; those making $100,000 would get a $2,000 tax cut. This of course is a nice savings for many workers but makes Social Security advocates nervous that it could jeopardize the retirement program’s finances. Social Security has not given a raise in two years and has been in the in debt both of those years. The government would borrow about $112 billion to make Social Security have the required funding. This is a slippery slope although it is only one year. As we started this we also would see a little bump in pay which as with most American has not happened in a while. If you did not know how Social Security is funded today you are taxed through payroll 6.2 percent on the first $106,800 earned by a worker. The tax is matched by employers. It is estimated that there are 155 million workers that currently pay into the system. We know this is wrong but for once we will stay mute.

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