A repository for Marcospinelli's comments and essays published at other websites.

Obama Signs Payroll Tax Cut Extension Into Law

Wednesday, February 22, 2012


There are other ways to get stimulus money to the poor and middle classes, but if you support payroll tax "holidays", you're also for ending Social Security and Medicare.

When politicians say that "Social Security is the third rail of politics", they mean it with a hostility that should be reserved for their Corporate Masters.  

You don't see politicians putting campaign finance and election reform on their agenda from year to year as you do their continuing assaults on social safety net programs for the People.

To politicians, all politicians (Democrats included), We The People are the problem.  If only they didn't have to deal with making us happy to get our votes that keep them employed.  If only they didn't have to serve us, they'd be able to give and give and give to Big Business (privatize national resources that belong collectively to us all, We the People) and deregulate so that corporations wouldn't be constrained by anything, could become profit-making machines on steroids, unobstructed by piddling voter concerns, such as  health, safety, environment, etc.  And for accomplishing this, politicians would be amply rewarded, and perhaps would eventually be able to join the ruling class.

You can choose to believe what you will about Democratic politicians, but the fact is that the DLC controls the DemocraticParty, Democrats in Congress and in the White House, and they've signed on to privatize public resources and utilities and deregulate.  Democrats in Congress, despite all their campaign promises, have refused to regulate or perform their Constitutionally-required role of oversight, both in the Bush and Obama administrations  -- What little regulating they've put in legislation the last 2 years is ineffective for a whole array of very sneaky moves.  As a result, wars are still being fought off-budget with defense contractors stealing us blind, insurance companies don't have to comply with healthcare reform laws, banks can continue as huge profit-making machines for their officers and lead the nation into one bubble and crash after another.

You can choose to think of Obama and his intentions in whatever way makes you happy.  What you can't do is explain how any of what Obama's done these past two years has been in the People's and not the Corporations' interests.

What's gotten lost in the news cycles these past months is Obama's new NAFTA-like treaties that means more Americans' jobs will be outsourced overseas.  And then there's Obama's Deficit Commission, Simpson-Bowles (and its plan for gutting Social Security and Medicare), along with the renewed push on the Dream Act, which means a flood of immigrants working for slave wages.  

We The People are being transformed, from sheep to sacrificial lambs.  

And what's coming no matter who wins in 2012 is the privatization of Social Security.
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Obama Signs Payroll Tax Cut Extension Into Law


The FICA/payroll tax goes into the Social Security Trust Fund.  This is a dedicated fund currently worth $2.6 trillion, which has been built up over time through employee and employer contributions, along with accrued interest.  Current and future Social Security beneficiaries receive benefits from this fund.  No general revenues are involved, except for administrative and clerical costs.

Under the payroll tax cut initiated in the 2010 lame duck tax deal, the revenue loss to the Trust Fund from the payroll tax holiday is made up through compensatory payments into the Trust Fund from general revenues. The President proposes to continue this scheme — deepening a relationship between Social Security and general revenues (read deficit) that did not exist until the December 2010 tax deal.  This will make Social Security increasingly vulnerable to demands for “reform.”

In the worst case, Congress could choose to enact the payroll tax cut without actually appropriating revenue compensation for the Trust Fund.  This would mean that the payroll tax cut directly depletes the Trust Fund, creating financial/actuarial problems far sooner than the currently anticipated shortfall date of 2036.

But even if the Trust Fund receives full revenue compensation — for both employer and employee contributions — Social Security will be jeopardized.  That’s because the resources in the Trust Fund will be increasingly comingled with general revenue funds — and, hence, increasingly connected to the deficit.

If the government can’t  pay back Social Security money it has borrowed to pay for other things (through IOUs, bonds, etc), it certainly won’t be shy about cutting Social Security to pay itself back for funds it shared with Social Security to offset revenue losses from the payroll tax holiday.

Also worth worrying about here is contagious political cowardice about “raising taxes.”  The payroll tax holiday is framed as just that — a holiday, ie, a short-lived break. But as we know from other tax cuts with built-in expiration dates, the planned end of a tax cut quickly becomes a “tax increase” in popular parlance.  There hasn’t been much resolve to allow the years-long tax holiday for the rich to end. 

When the time comes, will there be greater resolve to allow an end to the 2-year tax holiday for workers and 1-year tax holiday for employers?  Even when billed as a “middle class tax increase” and a “job-killing tax on business”?

Once the payroll tax basis of Social Security financing has been corrupted the future of Social Security will no longer be in doubt.  It won’t have one.
About Barack Obama
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Obama Signs Payroll Tax Cut Extension Into Law


Is Obama trying to kill Social Security without explicitly saying so?

He put Social Security “on the table” for consideration by his Deficit Commission — even though Social Security has not contributed to creating or sustaining the deficit/debt in the first place.  He kept Social Security on the table when he made a deal to delegate deficit reduction authority over entitlements to an undemocratic Super Committee.  Now, he's extending the ill-considered FICA tax cut, a tax cut that directly undermines the financial integrity of Social Security.According to the White House Fact Sheet on “The American Jobs Act”  the FICA tax holiday for workers will be increased to a 50% reduction, lowering it to 3.1%.  Under the 2010 tax deal, the payroll tax for workers was reduced from 6.2% to 4.2%.  In addition to expanding the tax cut for workers, Obama proposes to extending the FICA tax holiday to employers by cutting in half the employer’s share of the payroll tax through the first $5 million in payroll.

Big questions about the wisdom, efficacy, and implications of a tax-based jobs strategy need to be debated.  Even bigger questions about the consequences of the payroll tax holiday in particular need to be answered.  These questions are not just about the relationship between payroll tax cuts and job growth.  They are about the future of Social Security.
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Russ Feingold 'Pleased' Anwar Al-Awlaki Was Taken Out By Drone Strike


"because he happened to be with other terrorists who were targeted"?

Who is a "terrorist"?  By whose branding?  

That's what rule of law means:  Evidence tested and declared to be true by a duly authorized court.

We fought in a revolution, against a king, to get that.
About Al Qaeda
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Russ Feingold 'Pleased' Anwar Al-Awlaki Was Taken Out By Drone Strike


Al-Awlaki never renounced his citizenship, and the Obama adminsitration never denied Awlaki's citizenship when it targeted him for assassination.

But you miss the point anyway.

Our Constitution doesn't allow for the extra-judicial flights of fancy by the Executive branch.  If you have a case to make against anyone, you make it in a court of law.  Where everyone can see it.
About Al Qaeda
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Russ Feingold 'Pleased' Anwar Al-Awlaki Was Taken Out By Drone Strike


"If this were a dictatorship, it would be a heck of a lot easier, just so long as I'm the dictator." - George W. Bush, December 18, 2000

About Al Qaeda
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The Gas Wars

Tuesday, February 21, 2012

I like Robert Reich as much as the next liberal, but let's remember that he's as much a politician as Newt Gingrich, and spouts whatever the DLC's rhetoric of the day is.  

6/2/08 - Candidate Obama Promises To Impose Windfall Profits Tax On Oil and Gas Industry

6/25/08, what Candidate Obama will do to help consumers with rising gas prices included a second round of stimulus rebate checks, impose a windfall profits tax on oil companies, and close the Enron Loophole that allows for speculatio­n's unregulate­d upward pressure on gas prices.

The first of Obama's many broken pledges and promises once he got elected was reneging on his pledge to impose 'Windfall Profits Taxes on the Oil and Gas Industry", etc.:
http://www­.youtube.c­om/watch?v­=jMbqVDymi­7k

11/10/08 - President-­Elect Obama Abandons Windfall Profits Tax on Oil Companies

12/23/08 - When pressed about his abrupt about face on imposing windfall profits taxes, President-­Elect Obama said, "The prices have now dropped - We'll see about doing that if or when they rise again."

Since 12/08, the price of oil has reached $80/barrel several times, which is the amount that Candidate Obama had pledged would trigger his windfall profits tax. 

http://www­.reuters.c­om/article­/topNews/i­dUSWAT0096­3020080609
http://www­.youtube.c­om/watch?v­=jMbqVDymi­7k
http://blo­gs.abcnews­.com/polit­icalpunch/­2008/12/ob­ama-abando­ns.html
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