Over at U.S. News, Dean Clancy argues that eliminating the payroll tax – and thus paying for social security out of general tax revenues – simplifies the problem of how to fix the program.
Why not supplant the payroll tax altogether, and as soon as possible? The payroll tax is the biggest tax most Americans pay, and regressive. It falls hardest on low-wage workers. Eliminating it would provide meaningful relief to every American wage-earner, with the greatest relief going to those who need the the help the most. Abolishing it would be economically beneficial and politically popular. To avoid increasing the deficit, we could raise or impose other taxes that are less regressive – although, to be honest, I’m not sure we really need to. If anything, America’s less-than-stellar economy could stand a tax cut right now, and what better kind of tax cut than one that reduces burdens on job creation?
I like $800 billion annual tax cuts as much as the next guy, but this just seems crazy to me.