Congress is ready to take money away from the retirement trust fund defunding Social Security to create revenue as payment to lower the $16 trillion national deficit cutting payroll taxes with other source of revenues for the political benefit of these outrageous payroll tax cuts as hundreds of billions of dollars will increase public debt.
With the payroll tax extended this past holiday season set to expire in March, there seems to be little doubt from the Republicans and the Democrats that the upcoming negotiations will result in an extension of the 2% payroll tax cut past the 2012 presidential election.
The payroll taxes are to supply the Social Security trust funds with revenue, and cutting these taxes without securing spending cuts drives a massive amount of debt, currently estimated at $120 billionyearly. This is based on the President Barack Obama not passing a balance budget in more than 1000 days. The payroll tax is considered a benefit to help the struggling economy. Defunding of the retirement trust funds has presented Congress with a scenario to reform Social Securityending retirement benefits.
If Congress endorses the tax-cuts and they became permanent the Social Security Trust Funds could lost revenue and not pay on retiree’s future benefits. This will increase demandson lawmakers to make the system more effective, including spending cuts.
The problem is Congressional members are pushing these payroll tax cuts to promote Social Security privatization hoping that individuals that contribute into the fund will treat as an personal investment account making it private meaning employees will receive less benefit money that the current system. If Congress locks the 2% in for the next twenty years less payout into retirement funds more towards governmental expenditures.
Putting the retirement funds into a private investment account at 2%, personal investment could be used at any time with less interest on the trust fund. Interest is directly included into the retirement trust fund. Congress is very well aware of the extra funds.
Individualize Social Security savings would initially provide more revenue to the trust funds than Congress’ now acceptable plan to legislate an unfunded payroll tax cut. It’s not clear to believe that the 2% of payroll tax should be diverted from the trust funds diverted to invest in personal retirement accounts. This does not give lawmakers the right to meddle into our retirement fund for revenue purposes.
The payroll tax provides a window of opportunity to present Social Security reform. It highlights the crushing liability of the current system and clearly exposes Washington’s corrupt tendency to allocate the program’s funds for political interests rather than its intended use.
Franklin D. Roosevelt passed law that Social Security as a contributing insurance retirement program mandated that all working Americans contribute into the fund their entire working lives receive these benefits once retired from employment. The current system has trillions of dollars saved payable for the next twenty five years. Congress wants to tap into those resources.
The government has tried to manipulate the entire Social Security system for economic reasons where benefits were in direct amounts to contributions used to fix taxation and resources they deem fit. That is why Roosevelt separated Social Security “contributions from the general taxation.” He recognized greedy politicians could easily influence and corrupted for economic reasons. That has influenced infected “many decades of irresponsible government manipulation.”
If the opportunity to reform our Social Security system, the younger generation will have the responsibility to govern individual retirement private accounts as an “opt-out of” the Social Security system which is no more than a personal savings account. If “opt out” is an option. There will be hundreds of billions of dollars in increased debt.
Congressat present is taking money from the trust funds for the political benefit of these payroll tax cuts to increased debt. If no offer to “opt-out” of Social Security, future obligations to younger workerswould be limited. The amount eligible to “opt out” can be increasing restricting the government’s ability to engage in misconduct that riskssecurity in retirement. Has Washington finally found a way to halt retirement benefits? The system is not broken, so leave it alone.