Below (scroll down):
- Social Security and Medicare Still in Actuarial Deficit on a Long-Term Basis
- Meditations On the National Popular Vote
- Do the rich pay their fair share?
- Are You a Tea Partier and Don’t Know It?
- Ending Civil Asset Forfeiture Abuse in Tennessee
- We Will Not Fall For Socialism
- The Rhetoric of Ronald Reagan
- Even a Bad Investor Can Beat Social Security
- Celebrating Freedom in a Country That Seems to Be Throwing It Away
- Making the World Safe for Democracy – One Therapy Dog at a Time
- Thanking Our Volunteers for a Great 2018
- Tea Party Victories in 2018
- A Graphical Update on the National Debt
- Tea Party Bill Hopper
- In a Perfect World, the Government Would Protect Our Rights, But....
- Why I Oppose a 'Single-Payer' or 'Public Option' Medical Plan
- Liberals Say the Darndest Things (Booth Truth – 2018 Irish Festival)
- Leftist Battlecry: “No Borders! No Walls! No USA at All!”
- What's Driving America's Spending Changes, a Historical Perspective
- D.C. Sights for Tea Partiers
- Social Security and Medicare Trustees Issue Yet Another Warning
- Enough with the Government Dependency, Already!
- What If You Had No Right to Life, Liberty, or Property?
- Insider Reveals How the Media Distort the News on Guns
- U.S. Becoming More Economically Free, and That’s a Good Thing
- Why Do We Have the Second Amendment Right to Bear Arms?
- The Forgotten Black Patriots of the Revolutionary War
- How to Cure Poverty
- Let the Opportunity Society Work Its Magic
2019 UPDATE
- previous updates and original article here
Social Security and Medicare Still in Actuarial Deficit on a Long-Term Basis
by Potomac Tea Party
May 2019
PERMALINK
The 2019 Social Security Trustees report from the government repeats what has been known for years: Social Security is actuarially unsound and therefore unsustainable in the long term. To be fully solvent throughout the next 75 years, payroll taxes would have to be raised by 2.70 percentage points, or benefits would have to be cut 17 percent, or some combination of payroll taxes and benefit cuts would have to be adopted. This assumes lawmakers act right away. The fixes get harder the longer they wait. Also, Social Security is currently adding to the deficit. Only ‘interest’ from phony ‘trust funds’ that have already been spent allows the government to maintain the fiction that Social Security’s total income exceeds current program costs. But the jig is up. This is the last year, according to the Trustees, that the fiction can be maintained.
The Medicare Trustees reported equally dismal findings. The Medicare HI actuarial deficit is increasing, and expenditures are expected to exceed revenues in all future years. As usual, the Trustees say that changes to the program are needed sooner rather than later.
Highlights from the 2019 Social Security Trustees Report
- previous updates and original article here
Social Security and Medicare Still in Actuarial Deficit on a Long-Term Basis
by Potomac Tea Party
May 2019
PERMALINK
The 2019 Social Security Trustees report from the government repeats what has been known for years: Social Security is actuarially unsound and therefore unsustainable in the long term. To be fully solvent throughout the next 75 years, payroll taxes would have to be raised by 2.70 percentage points, or benefits would have to be cut 17 percent, or some combination of payroll taxes and benefit cuts would have to be adopted. This assumes lawmakers act right away. The fixes get harder the longer they wait. Also, Social Security is currently adding to the deficit. Only ‘interest’ from phony ‘trust funds’ that have already been spent allows the government to maintain the fiction that Social Security’s total income exceeds current program costs. But the jig is up. This is the last year, according to the Trustees, that the fiction can be maintained.
The Medicare Trustees reported equally dismal findings. The Medicare HI actuarial deficit is increasing, and expenditures are expected to exceed revenues in all future years. As usual, the Trustees say that changes to the program are needed sooner rather than later.
Highlights from the 2019 Social Security Trustees Report
- OASDI -Total income was $1,003 billion, which consisted of $920 billion in non-interest income and $83 billion in interest earnings.... Under the Trustees’ intermediate assumptions, Social Security’s total cost is projected to be less than its total income in 2019 and higher than its total income in 2020 and all later years. Social Security’s cost has exceeded its non-interest income since 2010. For 2019, program cost is projected to be less than total income by about $1 billion and exceed non-interest income by about $81 billion.... Under the Trustees’ intermediate assumptions, OASDI cost is projected to exceed total income starting in 2020, and the dollar level of the hypothetical combined trust fund reserves declines until reserves become depleted in 2035..... For the 75-year projection period, the actuarial deficit is 2.78 percent of tax-able payroll, decreased from 2.84 percent of taxable payroll in last year’s report.... To illustrate the magnitude of the 75-year actuarial deficit, consider that for the combined OASI and DI Trust Funds to remain fully solvent throughout the 75-year projection period: (1) revenue would have to increase by an amount equivalent to an immediate and permanent payroll tax rate increase of 2.70 percentage points1 to 15.10 percent, (2) scheduled benefits would have to be reduced by an amount equivalent to an immediate and permanent reduction of about 17 percent applied to all current and future beneficiaries.... Under the intermediate assumptions, the projected hypothetical combined OASI and DI Trust Fund asset reserves become depleted and unable to pay scheduled benefits in full on a timely basis in 2035....
- For the 75-year projection period, the HI actuarial deficit has increased to 0.91 percent of taxable payroll from 0.82percent in last year’s report.
- The Board projects that expenditures will increase in future years at a faster pace than either aggregate workers’ earnings or the economy overall and that, as a percentage of GDP, they will increase from 3.7percentin 2018 to 6.5percentby 2093 (based on the Trustees’ intermediate set of assumptions).
- The Trustees project that HI tax income and other dedicated revenues will fall short of HI expenditures in all future years. The HI trust fund does not meet either the Trustees’ test of short-range financial adequacy or their test of long-range close actuarial balance.
- The financial projections in this report indicate a need for substantial changes to address Medicare’s financial challenges. The sooner solutions are enacted, the more flexible and gradual they can be.
Meditations On the National Popular Vote
by Knoxville Tea Party
April 2019
PERMALINK
This is why we have an Electoral College:
by Knoxville Tea Party
April 2019
PERMALINK
This is why we have an Electoral College:
Should 10% of the territory set policy for an entire country?
(Under the American system of independent states and an electoral college, no one gets to decide policy for everyone else. No one is forced to live contrary to their ideals -- each state gets to choose its own destiny. That's tolerance, and it helps us get along.)
– –
The Electoral College exists to ensure that a larger plurality of states are represented.
That's important.
Imagine if votes on passage of international treaties were weighed according to size of the population of each country negotiating -- China and India would make all the policy. And imagine the discontent of the nations ridden over rough-shod...
That's not "consent of the governed."
– –
One state casting more than its share of votes diminishes everyone else's vote. So if the National Popular Vote interstate compact's goal is truly to fairly count each and every qualified vote, will California still be casting the several votes it gained by including illegal aliens, as part of its population for the U.S. Census?
– –
The National Popular Vote compact would seem to violate the Constitution's Article IV, section 4's "guarantee to every state in this Union a Republican Form of Government."
If Minnesotans' electoral votes are decided in California, how is that a "Republican Form of Government" for the citizens of Minnesota?
– –
If the goal is majority rule, why not eliminate the Senate? After all, why should Rhode Island get the same number of senators as New York?
(Answer: So each state has equal representation in one branch of our federal government.)
– –
When majority rules, who'll protect minorities?
– –
If issues were decided by the size of a country's population, (in order of population) China and India, then Indonesia, Brazil, Pakistan, Nigeria, Bangladesh, Russia and Mexico would be in charge of our economy (and our daily lives).
In Europe, Germany, the U.K., France, and Italy would decide affairs for the entire continent. How would Montenegro, Monaco, Lichtenstein, Denmark, Switzerland, Greece, and Sweden feel about that?
(Majority rule, anyone?)
(Under the American system of independent states and an electoral college, no one gets to decide policy for everyone else. No one is forced to live contrary to their ideals -- each state gets to choose its own destiny. That's tolerance, and it helps us get along.)
– –
The Electoral College exists to ensure that a larger plurality of states are represented.
That's important.
Imagine if votes on passage of international treaties were weighed according to size of the population of each country negotiating -- China and India would make all the policy. And imagine the discontent of the nations ridden over rough-shod...
That's not "consent of the governed."
– –
One state casting more than its share of votes diminishes everyone else's vote. So if the National Popular Vote interstate compact's goal is truly to fairly count each and every qualified vote, will California still be casting the several votes it gained by including illegal aliens, as part of its population for the U.S. Census?
– –
The National Popular Vote compact would seem to violate the Constitution's Article IV, section 4's "guarantee to every state in this Union a Republican Form of Government."
If Minnesotans' electoral votes are decided in California, how is that a "Republican Form of Government" for the citizens of Minnesota?
– –
If the goal is majority rule, why not eliminate the Senate? After all, why should Rhode Island get the same number of senators as New York?
(Answer: So each state has equal representation in one branch of our federal government.)
– –
When majority rules, who'll protect minorities?
– –
If issues were decided by the size of a country's population, (in order of population) China and India, then Indonesia, Brazil, Pakistan, Nigeria, Bangladesh, Russia and Mexico would be in charge of our economy (and our daily lives).
In Europe, Germany, the U.K., France, and Italy would decide affairs for the entire continent. How would Montenegro, Monaco, Lichtenstein, Denmark, Switzerland, Greece, and Sweden feel about that?
(Majority rule, anyone?)
Do the rich pay their fair share?
- Someone making $1,000,000 will pay $340,000 in federal taxes, while someone making $10,000 will pay only $300
by John Michael Wagner
October 5, 2017
Reposted from The Case for Capitalism blog with permission of the author
PERMALINK
It is an article of faith to some class warriors that the rich do not pay their “fair share” of taxes. Is it true?
We can evaluate this claim since there is plenty of publicly available data. The data here comes from a 2016 CBO report.
Effective tax rates
It is difficult to look at the tax brackets themselves and draw a definite conclusion about fairness. Taxable income for most people is impacted by various deductions, exemptions, and credits that phase in and out at different income levels, and that apply in some circumstances but not others.
“Effective tax rates” cut through all this complexity and tell us what percentage of income is paid out as taxes. For example, someone who pays $5,000 of taxes on $50,000 income has an effective tax rate of 10%.
The graph below shows effective income tax rates for different income groups. The lowest quintile represents the one fifth of the population with the lowest incomes, the highest quintile represents the one fifth with the highest incomes, and so on. I also include the top one percent to show the very highest earners.
- Someone making $1,000,000 will pay $340,000 in federal taxes, while someone making $10,000 will pay only $300
by John Michael Wagner
October 5, 2017
Reposted from The Case for Capitalism blog with permission of the author
PERMALINK
It is an article of faith to some class warriors that the rich do not pay their “fair share” of taxes. Is it true?
We can evaluate this claim since there is plenty of publicly available data. The data here comes from a 2016 CBO report.
Effective tax rates
It is difficult to look at the tax brackets themselves and draw a definite conclusion about fairness. Taxable income for most people is impacted by various deductions, exemptions, and credits that phase in and out at different income levels, and that apply in some circumstances but not others.
“Effective tax rates” cut through all this complexity and tell us what percentage of income is paid out as taxes. For example, someone who pays $5,000 of taxes on $50,000 income has an effective tax rate of 10%.
The graph below shows effective income tax rates for different income groups. The lowest quintile represents the one fifth of the population with the lowest incomes, the highest quintile represents the one fifth with the highest incomes, and so on. I also include the top one percent to show the very highest earners.
As you can see, the effective tax rate for the lowest one fifth of earners is quite low at negative 7%. The rate is negative because low earners pay no federal income tax and in fact receive cash payments from government due to credits like EITC. The second-lowest quintile is also negative, which means the bottom 40% of income earners pay no income taxes and receive a cash subsidy from the tax code.
For the middle fifth of earners, only 3% of their income goes to income taxes. The top fifth pays 16%. At the very high end, the One Percenters pay 24%.
Clearly, those with high-incomes pay much higher taxes than those with low incomes.
TOTAL federal taxes
Some people admit that the rich pay their “fair share” of income taxes, as shown above. However, they claim that the rich don’t pay their “fair share” of total taxes, including payroll taxes (Social Security, Medicare).
We can also evaluate this claim. The same CBO report includes a comprehensive view that includes ALL federal taxes. It includes the income taxes mentioned above plus all payroll, corporate, and excise taxes.
The graph below shows the effective tax rates based on this comprehensive view of federal taxes:
For the middle fifth of earners, only 3% of their income goes to income taxes. The top fifth pays 16%. At the very high end, the One Percenters pay 24%.
Clearly, those with high-incomes pay much higher taxes than those with low incomes.
TOTAL federal taxes
Some people admit that the rich pay their “fair share” of income taxes, as shown above. However, they claim that the rich don’t pay their “fair share” of total taxes, including payroll taxes (Social Security, Medicare).
We can also evaluate this claim. The same CBO report includes a comprehensive view that includes ALL federal taxes. It includes the income taxes mentioned above plus all payroll, corporate, and excise taxes.
The graph below shows the effective tax rates based on this comprehensive view of federal taxes:
As you can see, when we include ALL federal taxes, the lowest one fifth of earners pay an effective tax rate of 3%. Not negative, but still quite low. For the middle fifth, it’s 13%. For the top fifth, it’s 26%. The One Percenters pay 34%.
Still lopsided. To put this in dollar terms, it roughly means that someone making $1,000,000 will pay $340,000 in federal taxes, while someone making $10,000 will pay only $300.
Share of taxes and income
Another way to look at this is to compare the share of total taxes paid to the share of total income earned. The chart below shows this data. Taxes here include ALL federal taxes.
Still lopsided. To put this in dollar terms, it roughly means that someone making $1,000,000 will pay $340,000 in federal taxes, while someone making $10,000 will pay only $300.
Share of taxes and income
Another way to look at this is to compare the share of total taxes paid to the share of total income earned. The chart below shows this data. Taxes here include ALL federal taxes.
As you can see, the bottom one fifth of earners earn 5% of total American income, but pay less than 1% (0.8%) of total federal taxes. The middle fifth earn 14% of total income and pay 9% of total taxes. The highest fifth earn 53% of income and pay 69% of taxes. The One Percenters earn 15% of income and pay 25% of taxes.
Note that only one quintile pays a share of taxes that exceeds their share of income, and it’s the highest quintile. Note also that the One Percenters pay the highest share of taxes relative to share of income.
This data shows that high earners earn a large share of total income. However, it also shows that they pay an even larger share of total taxes.
Do the rich pay their “fair share?”
So, do high-income folks pay their fair share of taxes? “Fair share” is a vague and nebulous concept, but I’ll try to answer the question. Let’s evaluate (a) in absolute terms and (b) in comparison to other income groups.
In absolute terms: The question here is, do the One Percenters pay ‘enough’ taxes?
34% of their income goes toward federal taxes. But that’s not all; they also pay other taxes. State and city income taxes, property taxes, various sales type taxes, etc.
Including all types of taxes, most One Percenters pay 45% to 55% of their income in taxes. Is that high enough?
It’s a judgment call, but in my opinion, it’s high enough. If half or more of your income is taxed away, you are working more for government than for yourself and your family!
In comparison: The question here is, do the One Percenters pay enough taxes compared to other income groups?
The data is crystal clear. High-income folks pay much higher taxes than either the poor or the middle-class. For each dollar of income, the average One Percenter pays eleven times more taxes than the average person in the bottom quintile. I think eleven times more is enough more.
Conclusion: It seems reasonable to conclude that the rich do indeed pay their “fair share” of taxes. Claims to the contrary are closer to fact-free propaganda.
Inequality and the tax code
Despite the facts, no doubt some readers are still not persuaded that the rich pay enough taxes. They should understand that the tax code cannot eliminate economic inequality.
First, inequality is created outside the tax system. The tax code does not create inequality.
Second, there are limits to what can be done via taxes. A limited amount of redistribution is good for society, but too much will cause economic stagnation. Why? Because high taxes and generous assistance programs discourage both high and low earners from engaging in productive economic activity.
Third, economic stagnation is not good for anyone, including low earners. The importance of economic growth cannot be overstated (see this post), and growth is better for everyone. Too much redistribution kills the goose that lays the golden eggs. A focus on growth is more socially harmonious and economically effective.
The well-to-do already pay disproportionately higher taxes to help the less-fortunate. Can we call a ceasefire in the class war, and focus on growth?
Note that only one quintile pays a share of taxes that exceeds their share of income, and it’s the highest quintile. Note also that the One Percenters pay the highest share of taxes relative to share of income.
This data shows that high earners earn a large share of total income. However, it also shows that they pay an even larger share of total taxes.
Do the rich pay their “fair share?”
So, do high-income folks pay their fair share of taxes? “Fair share” is a vague and nebulous concept, but I’ll try to answer the question. Let’s evaluate (a) in absolute terms and (b) in comparison to other income groups.
In absolute terms: The question here is, do the One Percenters pay ‘enough’ taxes?
34% of their income goes toward federal taxes. But that’s not all; they also pay other taxes. State and city income taxes, property taxes, various sales type taxes, etc.
Including all types of taxes, most One Percenters pay 45% to 55% of their income in taxes. Is that high enough?
It’s a judgment call, but in my opinion, it’s high enough. If half or more of your income is taxed away, you are working more for government than for yourself and your family!
In comparison: The question here is, do the One Percenters pay enough taxes compared to other income groups?
The data is crystal clear. High-income folks pay much higher taxes than either the poor or the middle-class. For each dollar of income, the average One Percenter pays eleven times more taxes than the average person in the bottom quintile. I think eleven times more is enough more.
Conclusion: It seems reasonable to conclude that the rich do indeed pay their “fair share” of taxes. Claims to the contrary are closer to fact-free propaganda.
Inequality and the tax code
Despite the facts, no doubt some readers are still not persuaded that the rich pay enough taxes. They should understand that the tax code cannot eliminate economic inequality.
First, inequality is created outside the tax system. The tax code does not create inequality.
Second, there are limits to what can be done via taxes. A limited amount of redistribution is good for society, but too much will cause economic stagnation. Why? Because high taxes and generous assistance programs discourage both high and low earners from engaging in productive economic activity.
Third, economic stagnation is not good for anyone, including low earners. The importance of economic growth cannot be overstated (see this post), and growth is better for everyone. Too much redistribution kills the goose that lays the golden eggs. A focus on growth is more socially harmonious and economically effective.
The well-to-do already pay disproportionately higher taxes to help the less-fortunate. Can we call a ceasefire in the class war, and focus on growth?