Should payroll taxes be abolished?

[Admiral Yi]

Continuing the theme of taxation threads, I read an opinion piece by Steve Rattner in the Sunday NYT.  I gather he was some Treasury flunky in the Bubba administration.  He proposed ending the fiction that payroll taxes are the means by which contributors get "vested" in the system, concocted by Effdeear to hornswoggle (there's a good word for the non-Americans) the American public who were leary of socialism.  Just throw Social Security and Medicare onto the general fund.

What say ye?

(Not what say Yi.  HA HA HA HA stole everyone else's joke.)

[CountDeMoney]

I read an opinion piece by Steve Rattner in the Sunday NYT.  I gather he was some Treasury flunky in the Bubba administration.

Good Lord, Yi.  He was a Wall Streeter for ages, and Obama's auto czar in the Treasury during the bailouts.

[crazy canuck]

Yes payroll taxes are the job killer.  Not taxing people so that can only afford a 100 foot yacht instead of a 100 foot one.

[DGuller]

Continuing the theme of taxation threads, I read an opinion piece by Steve Rattner in the Sunday NYT.  I gather he was some Treasury flunky in the Bubba administration.  He proposed ending the fiction that payroll taxes are the means by which contributors get "vested" in the system, concocted by Effdeear to hornswoggle (there's a good word for the non-Americans) the American public who were leary of socialism.  Just throw Social Security and Medicare onto the general fund.

What say ye?

(Not what say Yi.  HA HA HA HA stole everyone else's joke.)

I agree with that proposal.  Social Security is social welfare program, deal with it.

[MadImmortalMan]

We should tax everything we want less of. So, Bieber Tax, Anime Tax and Telemarketing Tax.

[Habbaku]

Not taxing people so that can only afford a 100 foot yacht instead of a 100 foot one.

[Admiral Yi]

Let's say for the sake of argument we abolished FICA and FUTA.  That leads to the question then of the proper distribution of taxes throughout the income distribution.  What percentage of the population should be net recipients?  What percentage net neutrals?  What percentage net payers?

I'm talking about lifetime taxation and benefits, so leave out the obvious fact that retirees are net beneficiaries.

Something like 20/60/20 maybe?

[DGuller]

Let's say for the sake of argument we abolished FICA and FUTA.  That leads to the question then of the proper distribution of taxes throughout the income distribution.  What percentage of the population should be net recipients?  What percentage net neutrals?  What percentage net payers?

I'm talking about lifetime taxation and benefits, so leave out the obvious fact that retirees are net beneficiaries.

Something like 20/60/20 maybe?

It's not going to be symmetrical like that, because income distribution is highly skewed.  It's also unlikely to stay constant, because such ratios are going to be a function of the income inequality, and income inequality in turn can be affected by the very actions you describe.

[MadImmortalMan]

Also, they will skew over time as the future retirees will not be paid in current dollars.

[Admiral Yi]

It's not going to be symmetrical like that, because income distribution is highly skewed.  It's also unlikely to stay constant, because such ratios are going to be a function of the income inequality, and income inequality in turn can be affected by the very actions you describe.

Then use the present distribution, Captain Nitpick.

[DGuller]

It's not going to be symmetrical like that, because income distribution is highly skewed.  It's also unlikely to stay constant, because such ratios are going to be a function of the income inequality, and income inequality in turn can be affected by the very actions you describe.

Then use the present distribution, Captain Nitpick.

I don't have nearly enough information to even pretend to make an informed decision.  Sure, I can throw out a set of three numbers, but what value will they provide?

[garbon]

Not taxing people so that can only afford a 100 foot yacht instead of a 100 foot one.

Perhaps a 'one' is a type of vessel in Canada?

[Admiral Yi]

I don't have nearly enough information to even pretend to make an informed decision.  Sure, I can throw out a set of three numbers, but what value will they provide?

They will give an indication of what part of the income distribution you believe deserve to have their existence subsidized.

Or you could approach the issue from a defined-benefit POV.  What is the minimum consumption basket that all American should be guaranteed regardless of ability to pay?  Just free primary and secondary education plus minimal state pension?

[Jacob]

Some sort of health care should be included too, no? At the very least, some sort of emergency treatment?

[Admiral Yi]

Some sort of health care should be included too, no? At the very least, some sort of emergency treatment?

That's it?  No housing, no food, no walking around money?  Transportation?