Blame Paris Hilton!
Let's get some numbers straight here. All workers who make $90,000 or less in wages pay 12.4 percent in payroll...
Let's get some numbers straight here. All workers who make $90,000 or less in wages pay 12.4 percent in payroll taxes. (Yes, technically it's split between employer and employee, but economists tend to agree that the tax falls largely on the worker.) This hard-earned money then goes into the Social Security Trust Fund, which is presently building up large surpluses so that it can pay our Social Security benefits when we all retire.
Now Congress seems intent on borrowing and spending this money. The president, even as he continues to take everyone's payroll taxes, glibly claims that the Trust Fund "doesn't exist," that it's a bunch of "mere IOU's." Hm. So what are Republicans spending all this money on? Oh, that's right. Paris Hilton!:
I refer to the fact that House Republican leaders have scheduled a vote this week to abolish the estate tax permanently. Under a wacky provision of the 2001 tax cut designed to disguise the law's full cost, Congress voted to make the estate tax go away in 2010, but come back in full force in 2011.
With so many other taxes around, it's hard to understand why this is the one Congress would repeal. It falls, in effect, on the heirs to the wealthiest Americans. Fewer than 1 percent of the people who died in 2004 paid an estate tax, and half the revenue from the tax came from estates valued at $10 million or more . Counting both revenue losses and added interest costs, complete repeal of the estate tax would cost the government close to $1 trillion between 2012 and 2021.
Make no mistake, these two things are pretty directly related. After all, the reason why Bush thinks the government "can't" pay back the bonds owed to Social Security is because there are huge budget deficits. Congress, the story goes, needs those payroll tax receipts to paper over the huge budget deficits. And the huge budget deficits are being created by things like the estate tax repeal, so that heiresses like Paris Hilton don't have to pay taxes on an inheritance they have done nothing to earn. Once again: People working at, say, Wal-Mart put their taxes in. Taxes go out to the likes of Paris Hilton, who, until recently, didn't even know what Wal-Mart was. Fantastic!