Re: “A Social Security solvency solution: Tax the high earners” [May 25, Opinion]:
Richard Buck’s My Take essay on Social Safety perpetuates the mistaken perception that it’s one way or the other unfair that wages above the utmost of $168,600 should not topic to Social Safety tax. It’s honest to cap taxes as a result of advantages are additionally capped. No matter how a lot you earn, your month-to-month profit (at present full-retirement age) received’t exceed $3,822. In comparison with somebody who makes a extra common wage of $60,000, the excessive earner pays 180% extra in taxes however obtain a profit that’s solely 85% larger. As meant, Social Safety advantages are disproportionately weighted towards decrease earners.
Social Safety was by no means anticipated (and by no means funded) to supply 100% of a retiree’s monetary wants. In 1950, after the system had been in place for a full 15 years, the common month-to-month retirement profit was about 16% of the common wage, hardly sufficient to totally help a retiree. On account of a number of will increase tied to politicking within the Nineteen Seventies in addition to indexing advantages to inflation, the common profit has greater than doubled to 36% of the common wage.
Maybe the trail to solvency for Social Safety is just not punitive taxes however extra cheap advantages.
Ross Elkin, Seattle
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