We’ve been discussing this lately, and there’s nothing I like so well as to settle an issue once and for all. As soon as we reach a conclusion here, we will inform the rest of the country and put this thorny issue to rest once and for all.
This matters because currently Democrats are demanding that we rape and pillage the income of “the rich” (and I’ll remind you that this really torques me off) vs. Republican claims that only about 50% of Americans pay any income tax at all due to a lost social security card, not a large enough household income, or simply not paying it.
Social Security and Medicare are frequently considered pensions and their related taxes (hereafter referred to collectively as SS taxes) paid during one’s working years are frequently considered payments toward those future benefits. Is this a valid assumption or is the SS tax just another income tax? If SS taxes are pension payments and not income taxes, those who say only 50% of Americans pay income taxes are correct. If SS taxes are income taxes, claimants are not being clear in their assertions. So, which is it, people?
Obviously, the taxes are only levied on wage income, so in that way they are income taxes. However, they are not levied on dividends, interest, and capital gains income; they are only levied on wages, income earned through the sweat of one’s brow, for wont of a better description. Since their basis for being levied is income of one kind or another, I’m going to give that point to the “SS taxes are income taxes” argument, though it’s only half a point because not all income is susceptible.
However, there is the assumption that a person paying the tax is going to get something back for it. This is reinforced by the fact that Uncle Sugar mails taxpayers an annual statement giving an anticipated benefit at retirement. That certainly makes it look like a pension payment, doesn’t it?
It does unless you read the fine print. The fine print in your annual statement gives you a quick heads-up that the statement is a fantasy played out in the heads of politicians – otherwise known as a lie. And since we live in a world of reality rather than the euphoria predicted by optimistic politicians (who are really only optimistic that they can get out of office before the fit hits the shan), let’s look at the fine print.
This is the Queen Hotchibobo translation of the fine print (very similar to the King James version of the Bible: Reliable and Trustworthy – except easier to understand): The projections contained on this paper are not worth the paper they are written on, let alone the postage to get it to you. They are fictional numbers created by lying Congresscritters to keep you from seeing the truth as it is: They have spent everything you have ever given them, as well as all the money you ever will give them, as well as all the money your children will ever give them. There is not a chance in H E Double Hockey Sticks that you will ever collect even a fraction of this money because we’ve been lying to you from the very start. There is no savings account with your name on it. There is no lock box. There is no money with which to pay you these benefits. You are more likely to find a unicorn who farts gold dust than you are to get the money promised to you.
Why do we tolerate this? I don’t know. I suppose everyone thinks houses of cards are going to last forever until they fall down. People stayed in a city built below sea level while a Cat 5 hurricane bore down on them with nothing to protect them but dirt barriers constructed by corrupt politicians and their cronies because New Orleans had never drowned before. Barney Frank was willing to gamble taxpayer dollars with sub-prime loans through Fannie Mae and Freddie Mac because he’d never presided over a housing meltdown funded by taxpayer dollars before. People bought stock in Petfoods.com because technology stocks had never dissolved, taking their savings with it before.
And so far, our nationwide Ponzi scheme has not collapsed, but we all know it’s coming (or at least those of us capable of basic math know it.) So it is a pension? Well, it is certainly not a voluntary one. Do any of you know anyone who would willingly give their money over to Uncle Sugar for this “pension” if they were given a choice except the one between compliance and prison? “Not I,” said the cat.
Here’s the fact: It was never even designed as a pension, it was designed around a lie. What is the only permissible “investment” SS can make with your “pension payments”? US Gov’t bonds. That’s it. They are not allowed (thank the good Lord for small favors) to invest our confiscated money in any private business. What are gov’t bonds? Gov’t debt. What happens with the money SS gives the gov’t (just pretend with me for a second that these two things are not just separate pockets on the same Uncle Sugar – otherwise you’re going to see through the lie too quickly and all the rest of my scribblings will be wasted) when they get those special bonds? They spend it.
There is no savings account. There is no lockbox. Uncle Sugar is physically incapable of saving money. Even if they weren’t spending us into oblivion, they couldn’t save money. Ft. Knox is not a savings bank. The Federal Reserve Bank is not a real bank. The Treasury Dept. is not a place to store treasure. They can’t put your money in a coffee can buried in the White House lawn a la Bobby Bare’s Marie Laveau.
Various companies are using hmrc approved umbrella companies to hire external auditors and financial management heads to handle specific finances of a company such as payment of taxes and distributing of salary.
When they take tax money, whether it is called Social Security taxes, Income taxes, Tariffs, Fees, whatever, that money is spent. Period. They can’t save it even with 529 education plan. So whatever you thought you were saving for, you weren’t saving anything. You couldn’t save anything through Uncle Sugar no matter what they called it or what kind of gov’t bond they used to secure it. Every dime you have ever given them, regardless of what they called it, was a straight tax.
That means that any promise they make to pay you money out of your SS taxes/pension payments in the future is a lie. They cannot promise you the wages of your children. You want to know why? Because there is no generational covenant that you can impose on your children. None. If they don’t want to work full time for 25% of their income so you can take 75% to draw a SS check, they will just vote in some Congresscritters who will tell you to go pound sand. And pound sand you will, because you will have no choice. There is no contract. There is no legal obligation. There is no pension.
As a matter of fact, it is the ultimate in assholerly to even pretend like there should be. Seriously, I want you to take it out to a family level. Pretend I am ready to retire. I have $100,000 in debt secured by my house. I have $1,000 in my savings account. Do I get to tell the kids, “Hey, kids, I am ready to retire now, you’re going to have to pay that debt, but my house and my savings are mine.” No. We spent bucketloads of money. Bucketloads. Far more than we will ever pay back. Where do any of us get off saying that we have some kind of payment coming from the gov’t? Talk about brass balls.
So my conclusion? It is not a straight income tax because not all income is affected, though it is certainly a tax on income. It is levied extraordinarily unfairly, as a person with kids gets back all their tax plus some while people with no kids pay 15.3% on every [redacted] dime if they make over $400.
That does not mean that we should screw the rich because they aren’t getting screwed enough. My grandma said it best, “Many hands make light work.” We should all be paying something, with the added benefit that if we all had skin in the game, when the politicians promised bennies with the promise that they were going to pay for it with someone else’s money, people would quit believing them. There’s nothing to make you pay attention to DC like having them throwing your money around like a guy with a stolen credit card.
It does mean that politicians lie. No, that is not news. It does mean that our income taxes are levied in a method that could best be described as economically destructive and more accurately described as crazy pants.
It is absolutely not a pension payment, because you’re not saving a dime, no matter what they tell you. No more than I saved $300 when I spent $800 the other day when I hit that great sale at Macy’s. What I did was spend money. What you are doing is giving Uncle Sugar money and he’s pounding it down a rat hole. If that’s a pension or savings account, I’m Bill Gates.
Conclusion: income tax. Let’s talk about the fundamentally unfair way our tax system is designed; let’s talk about the ridiculous and destructive levels of financial support given to people in housing credits, food stamps, etc.; but let’s not argue any longer that the working poor pay nothing in income taxes. We’ll just alienate the guy who graduated, started a job, and sees that he’s being robbed by the same gov’t that is robbing the rest of us.
And just in case you don’t know who Marie Laveau is, your education is lacking. Come with me to the bayou because you’re just as likely to get Marie’s money as you are to get SS retirement.
UPDATE: I didn’t think to add Mike’s link earlier, sorry GC.