While the most straight forward solution to fixing Social Security would be so simple that even grade schoolers could see it (but not politicians or the wealthy) once explained the situation, would be to raise the limit taxing SS from the $106,000 to infinity, those of us living in a real world know we ain’t got a snowball’s chance in Boehner’s Tanning bed of that happening. With that in mind, I’d like to propose something more drastic but eminently more fair.
The big corporations have gotten every tax break possible over the last 11 years, well, maybe not EVERY break. And we keep hearing how if we just gave business more tax breaks, they would happily create more jobs. It hasn’t worked that way because right down to it, the base instinct of business in America (and it’s spreading to Europe) is greed.
Corporations have had every opportunity to create jobs through massive tax cuts the Republicans instituted since 2001 yet more and more jobs have disappeared. Many of these jobs are no longer provided by corporations in the United States. Rather than taking the tax breaks given them and creating new, decent paying American jobs, they’ve willingly chosen to take the money and run…to other countries. There, they pay pennies for work that Americans used to do. Work that still makes handsome profits for corporations. Yet they charge Americans here as though those jobs were still being paid at American Rates. The result is extreme profits.
Now we have an invented crisis involving Social Security, much like the mirage created over the debt ceiling. There’s still a hell of a lot of money in the SS Trust Fund and the greedy are licking their chops over how to get it and make the public think government and business really is looking out for their best interests while pilfering the Fund.
Woe will happen unless we strengthen SS! How? By killing it of course. Or making sure those in power can give as much of that money to their friends as possible. So what do we do?
Well, we have 14 million unemployed in this country. The “normal” unemployment rate is said to be something like 4%. If we have 150 million people working and 4% or 6 million are always looking for work, that means 8 million are jobless mainly because the government today simply wants them unemployed. Harsh? Yep! But probably true.
Of the 8 million jobless, various studies have provided data that upwards of 5 to 6 million jobs have been lost since 1998 due to outsourcing. The University of California at Berkely (those liberal bastards) did a study that suggested nearly 14 million jobs will be outsourced by 2015. But let’s look at the approximate 6 million already lost and how those affect this mythical Social Security Problem.
I’m going to make a presumption that those jobs all paid minimum wage. I know that’s not the case. AIG said in 2002 that over 600,000 professional and management positions went across the ponds. But for the sake of this rant, let’s stick with just 7 bucks an hour.
Until this year, employers paid 6.2% of a paycheck for their share of the SS Fund. The employee paid 4.2%. That’s 10.4% out of an employee’s paycheck he or she expects to go to the SS Fund. But if the job isn’t there because it’s gone overseas, the fund doesn’t get the money. However, the corporation still gets its profits...AND its tax breaks!
By the way, screw the tax holiday. It’s only helping the corporations and screwing the SS recipients. Thanks Barry.
Now that 10.4% adds up pretty fast. At minimum wage it's around 73 cents per hour, $5.82 per 8 hour day,$29.12 per 40 hour work week and about $1500 per work year. All at minimum wage paid into the SS Fund. If those 6 million jobs stayed in the U.S., the Fund would take in about 9 billion extra dollars a year! And that’s just at minimum wage.
What this means is corporations have cost the Social Security Fund over 80 billion dollars since 2002 (at minimum wage). But they’ve gotten nearly a trillion in tax cuts during the same period. Plus what they saved by NOT paying into Social Security. Nice exchange…for them!
So how about we charge corporations the 10.4% SS Tax of the going American Rate for every job they outsource? It’s quite fair. They get to keep their tax breaks and the Fund gets billions more per year. Of course, those who got paid 50, 80, a hundred K per year would cause business to contribute more and it’s entirely possible the Fund could gain well over 20 to 30 billion per year or an additional 270 billion dollars since 2002 from SS Tax that the corporations have screwed the workers out of. Projecting that over the next ten years of the tax cuts SS could add maybe 400 billion dollars to it just from the fee to corporations for outsourcing U.S. jobs.
All of the previous numbers only account for 6 million. Since there are 8 million unemployed, add 25 % to that amount and you get much more money for the Fund.
We also have a supposed Medicare crunch. Guess how much more Medicare would get if we levied the 2.9% Medicare Tax on the corporations who outsourced jobs while getting big tax breaks? An extra $420 per year per employee or about 2 and one half billion dollars more per year. That’s about 25 billion more in the Medicare coffers for seniors just since 2002 and realistically maybe as much as 75 billion. And by 2020 that could increase 10 times to 700 billion. Coincidental number? Maybe.
Again, the numbers for Medicare are only for 6 million. Another 25% could be added to the total money collected for the Medicare Funding.
So the answer is simple. If Congress is really concerned about saving Social Security and Medicare, make them pass a law that forces corporations pay the SS and Medicare Tax for each American Job at fair rates they outsource in order to keep their tax breaks. Otherwise cut the tax breaks and give that money to the Social Security and Medicare Funds.
Then Santa will show up Christmas Day and the Easter Bunny will deliver us chocolate eggs right after that!