Irregular Maui News articles and letters appear on Social Security issues, some supporting the position of Ed Case and some supporting Mazie Hirono's position. Of course the situation, for both Social Security and government debt generally, would be helped if Congress would make the effort to undertake serious tax reform and address the known fraud that exists in both Social Security and government programs generally.
Hirono proposes to make all earned income (wages and salaries) subject to the payroll (Social Security) tax - similar to the Medicare tax - as an option to derive revenue from the richest of the rich and get the wealthy to pay their fair share. This proposal would indeed bring in very substantial revenue, but it appears Hirono has not analyzed the precise source of that revenue.
A simplistic analysis of Internal Revenue Service and Tax Foundation data indicate that, under her proposal, most of the increased Social Security revenue would come from middle-class incomes. (President Barack Obama has referred to the middle class as those families earning less than $250,000 in his tax policy proclamations.) Therefore, lifting the payroll tax cap would result in an overwhelming majority of the incremental tax collection coming from families earning between $110,100 (current cap) and $250,000.
The revenues derived from multimillionaires would be very modest simply because there are few individuals/families earning million-dollar salaries - most millionaire income derives from unearned income, primarily capital gains. I find it difficult to support that position.
Albert Nyberg
Pukalani
