Payroll Tax Cut Signals Motives of Politicians

The payroll tax cut debate is ludicrous. The media is paying close attention to how Republicans are the ones “holding the whole Democracy of America” as Carl Bernstein from Washington Post said on Morning Joe.

On the other hand, Republicans are blaming Democrats for not wanting to compromise. For example, Speaker of the House, John Boehner told President Obama last week, “I just think the American people expect us to do our work.” Yes they do Speaker, but Americans also want to hear truth.

Both sides are missing the point. The payroll tax cut is a hoax. This tax cut should not be extended for two months or a year. According to CBS News, taxes will go up by “almost $20 a week, or $1,000 a year, for a worker earning $50,000, and as much as $82 a week, or $4,272 a year, for a household with two high-paid workers.”

This kind of stimulus is absurd. Are $20 dollars really going to make a difference? As Senator Tom Coburn said on The Kudlow Report, “The average person making $40,000 gets 2% benefit by not paying their side…it’s a matter of whether or not you will raise their taxes back to what they were a year before last on social security.”

The Senator also stated on CNBC that the tax cut takes away $330 billion from the social security tax fund, while adding  “$2.6 trillion of IOU” money.  This is embarrassing. If President Obama believes that taking money away from pensions is going to stimulate the economy with close to 70 million baby boomers nearing retirement in the next couple of years, then he lives in “la la” land. But then again so are the Republicans that are not opposing the extension of the payroll tax cut. In fact, House Republicans want to extend it to a year.

Washington lacks leadership. No one is speaking against this gimmick of a proposal. Social Security is broke, as evident by this debate. As Forbes Matthew Campione wrote, cutting the additional revenue from the Social Security Trust Fund will leave government with two choices: “Government can renege by substantially reducing future benefits, or by not paying all of what it owes to the Social Security Trust Fund.” He believes that the former is most likely because politicians would not want to offend “70 million people [who] are, or will soon be, Social Security recipients.”

Did the payroll tax cut really help in 2011?  The quick solution to people’s financial problems does not lie in taking money from their social security; we need a cut in income tax.  The decision to cut Social Security provides evidence of the government’s current focus: short-term satisfaction. The payroll tax cut extension only satisfies families for two months. If the Republican proposal had been passed, people would be satisfied for a year.  Neither plan is a long-term plan and neither plan solves any problems permanently.  The unemployment rate is still very high; people are barely making ends meet.

It’s time to realize that politicians are playing us like a fiddle.  Whether you are a Democrat or Republican doesn’t matter. Both are to blame, but most specifically, President Obama is to blame. He’s the leader and he hasn’t shown one bit of leadership on this issue. He was pointing fingers at the Republicans while doing his Christmas shopping at a Virginia Best Buy. Mr. President, Christmas presents could have waited; what can’t wait is the fiscal instability of the country and more importantly, the retirement funds of 70 million people.

Alex Uzarowicz // Knox College // @AUzarowicz



  1. I agree that the cut is pointless. At the same time though the Republicans had to pass the bill whether we agree with it or not. I can see the ads now. Republicans allow the payroll tax cut to end. What more proof do you need that they don’t care about the middle class.

    Until we get Obama out of office and take over the Congress we have to make deals like this. Politics is a game of Chess. The Republicans are making the right move to not get killed in 2012.

  2. I speak for the poor class of Americans. I worked for most of my life, but spent many years on layoffs from GE. Of course, I had 13 other employers while on these layoffs. If I had not continued to return to GE after the layoffs until they moved the plant to Mexico, I would not have received the benefits from TAA to complete my Bachelor’s Degree as I did, so I feel very blessed in this regard.
    However, the BS in Business Administration (’98) did not help me get a job; what it did do was show me how utterly useless 4-yr. degrees are nowadays in our current Imaginarium of information. We barely cracked the books in my classes at Gardner-Webb. We were lucky to cover 5 or 6 chapters of each textbook, as a rule. From this I gathered that there is so much to learn now that it is nearly impossible to do it in a reasonable amount of time. I would offer that the Master’s Program might more adequately cover the subjects studied, but remember I graduated 14 years ago. Our knowledge base has more than quadrupled since then, so the problem has only gotten worse. Before a textbook can be printed, some information contained therein is hopelessly outdated. Teaching must be the most difficult profession there is. Where do you decide to draw the line between research and accepted teachable truths, when those truths are apt to change so quickly?
    I don’t envy the students of today. I apologize for getting off on this tangent. I wanted to comment because I have never made $20 an hour in my lifetime, and don’t consider this figure to be average in this country, no matter what the so-called data reveals.

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