Obama's 'Progressive' Tax Plan Actually Screws Over The Little Guy

[FarCenter]

What the President didn’t say in his speech yesterday is far more important than what he did say. He did not say word one about the 2% Social Security tax break that has been on the books the past few years. What this means is that the FICA tax break is going to expire. When it does, every worker’s paycheck is going to get hit by 2%.

In the 2012 Social Security Trust Fund report to Congress the Trustees estimated that total FICA (SS taxes) would amount to $733.4B in 2013. The 2% increase in FICA taxes in 2013 will increase workers tax load by $120B. Therefore the combined effect of extending the sub-250k tax cut and the increase in FICA comes to a paltry $30B.

Even worse is the way in which the increase in FICA taxes will be felt by workers making $60K or less. (The average annual wage in the US is $42,000). Households in the lower tax brackets will not get much benefit from extending the Bush tax cuts, but they will, on average, see their take home pay reduced by $1,200 a year.

http://www.businessinsider.com/obamas-progressive-tax-plan-actually-screws-over-the-little-guy-2012-7

[phleshdef]

1. BS. The FICA tax break HAS to expire eventually. It was never intended to be permanent.

For a few years, it doesn't hurt, but for an extended period of time, it puts social security in a tight spot. So no, thats not "screwing over the little guy", thats ensuring the little guy still has social security waiting for them in their old age.

[Wounded Bear]

2. FICA is still higher than pre-Reagan era...

even with the recent break. Reagan doubled it to cover the Baby Boomers (me) meaning that we were the first generation to support our parents, and pay for our own retirement. It was pay as you go, it's been pre-pay before you go since Reagan.

Cry me a river. I'll pay it.

[democrat_patriot]

3. Good. Shore up Social Security. It's worth 2%.

[DCKit]

8. +1 It was a bad idea to drop it down...

it simply gives the Austerians more excuses to say SS is broke and can't pay the bills.

They don't want to get rid of it, they want to hand it over to Wall St. and the Banksters.

[Lionessa]

4. There's a calculation issue here. If av Inc = 42K then av FICA increase is only $840

But hey, $1200 sounds so much scarier.

[pnwmom]

5. Obama's not trying to screw the little guy. He has a Rethug House. What do you think

he can do about that?

[TheKentuckian]

6. To my mind the screwing was having the cut at all.

The "little guy" needs the hell out of his Social Security and needs it before death's door.

[Comrade_McKenzie]

7. ANY taxes on incomes below or at poverty level I do not support. nt

[SidDithers]

9. Bullshit...

written by a former hedge fund manager and hosted by a website run by a former analyst fined and banned from the investment industry for stock fraud.

Sid

[progressivebydesign]

11. thank you for the voice of reason and information. n/t

[denverbill]

10. Yes, Obama is always about screwing the little guy. That's why he requested this in the 1st place.

He's so unlike the Republickers, who always look out for the little guy by demanding a reduction in the estate tax in return for agreeing to the payroll tax cut in the first place.

[progressivebydesign]

12. Agreed. I'm really excited to see what RMoney will do for the little guys if he wins..

I bet each of the "little guys" will be getting a pony, or maybe a unicorn, and boxes of free money and a personal physician on call, and a three week vacation in the Hamptons at the Koch Bros place.