This Headline should read "Obama cuts Social Security" .. but .. but .. he already has .. his reduction in the Payroll Tax shortened the life of Social Security for everyone.
No, it didn't. The reduced SS revenue was replaced from the general fund. He used the payroll tax as an easy way to let people keep the money immediately. It was equivalent to an across the board tax cut for everyone.
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The payroll tax cut was supposed to be temporary, but its already been extended once. As the fight over tax increases versus tax cuts of the past couple of decades should have shown you, short term tax cuts in Washington (that was what the Bush tax cuts were supposed to be in the first place, short term) have a way of sticking around longer than planned, especially as economic growth remains slow and lawmakers are wary of raising anyone’s taxes.
To continue payroll tax holidays by moving money into the trust fund from the general fund means Social Security will lose its status as a protected benefit owed to every working American and instead become politically vulnerable, just like any other government program.
Charles Blahouse, one of two public trustees for Social Security and a research fellow with the Hoover Institution said: “It’s a grave step for Social Security, and the program both financially and politically will be on a lot rockier footing.”
Robert Reischauer, the other public trustee and president of the Urban Institute, said "extending the payroll tax cut could, if it continues for a substantial period of time, undermine one of the foundational arguments that makes the Social Security program inviolate.”
Since Social Security began, it's been premised on a simple contract: Americans pay into the program’s trust fund over years of paychecks through the payroll tax. In return, when they retire, they receive monthly benefits.
The payroll tax cut changed that. Instead of being a protected program with its own stream of funding, Social Security, by taking money from general revenue, becomes more akin to other government initiatives such as Pentagon spending or clean-air regulation - programs that rely on income taxes and political jockeying for support.
Now, Social Security will have to compete with every other program, whereas before it had its own dedicated revenue. It broke the firewall that had always existed between the trust fund and the operating fund.
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