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The cap on social security contributions is fairly low. After $127,000 you stop contributing to the social security. That means that plenty of middle and uppe

The cap on social security contributions is fairly low. After $127,000 you stop contributing to the social security. That means that plenty of middle and upper middle class families are contributing exactly as much as the rich, while probably not having access to as many of the things that improve life expectancy.

loeg 10y ago
$127,000 individual income is 93% percentile. I don't think "plenty of middle and upper middle class families" is a good description of the top 7% of US earners. Social security is taxed on individual income, so you shouldn't look at this like a household income figure.
- dragonwriter 10y ago
  > $127,000 individual income is 93% percentile. I don't think "plenty of middle and upper middle class families" is a good description of the top 7% of US earners. If you use the traditional capitalist-economy "middle class" (the petit bourgeoisie who live primarily by applying their own labor to their own capital, rather than doing wage-labor for a capitalist or being a capitalist that rents labor rather than supplying it), I actually don't think that's unreasonable. If you use "middle class" to mean the middle income segment of the working class, then, sure, it seems weird.
dragonwriter 10y ago
This also easy to address; include capital income and not just labor income, remove the income (and benefit) caps, and add additional bend points to the benefit calculation formula. This secures the fiscal health of the program, drives it back in the direction of progressivity across the scale, and provides people who choose active personal capital management (either for a short time returning to wage labor, or permanently) but achieve merely a modest living at it the same security for retirement as those who chose wage-labor.
- rebeccaskinner 10y ago
  I would tend to agree that this seems like the simplest approach and would probably be the best bang (helping people) for the (regulatory) buck. It essentially becomes UBI for older folks. Personally (and I realize this goes against a lot of the HN values here), I'd like to see some form of reduced benefit paid out if people are already earning income. If social security guaranteed a minimum monthly income, but didn't pay out what you were already making in other income, it would both help to maintain solvency of the program, and also encourage older folks to retire and make more room for younger people to move up in the workforce. The big problem with that approach is I imagine it would probably cost more to police than it would save, and there are likely some unforeseen consequences to the way it would encourage people to act.
  - dragonwriter 10y ago
    > Personally (and I realize this goes against a lot of the HN values here), I'd like to see some form of reduced benefit paid out if people are already earning income. We do that without complicating benefit calculation by way of income taxes. It might be desirable to redirect the additional income tax resulting from that policy back into the OAS trust fund rather than the general fund, though. https://faq.ssa.gov/link/portal/34011/34019/article/3831/must-i-pay-taxes-on-social-security-benefits https://faq.ssa.gov/link/portal/34011/34019/article/3831/mus...

loeg 10y ago

$127,000 individual income is 93% percentile. I don't think "plenty of middle and upper middle class families" is a good description of the top 7% of US earners. Social security is taxed on individual income, so you shouldn't look at this like a household income figure.

dragonwriter 10y ago
> $127,000 individual income is 93% percentile. I don't think "plenty of middle and upper middle class families" is a good description of the top 7% of US earners. If you use the traditional capitalist-economy "middle class" (the petit bourgeoisie who live primarily by applying their own labor to their own capital, rather than doing wage-labor for a capitalist or being a capitalist that rents labor rather than supplying it), I actually don't think that's unreasonable. If you use "middle class" to mean the middle income segment of the working class, then, sure, it seems weird.

dragonwriter 10y ago

This also easy to address; include capital income and not just labor income, remove the income (and benefit) caps, and add additional bend points to the benefit calculation formula. This secures the fiscal health of the program, drives it back in the direction of progressivity across the scale, and provides people who choose active personal capital management (either for a short time returning to wage labor, or permanently) but achieve merely a modest living at it the same security for retirement as those who chose wage-labor.

rebeccaskinner 10y ago
I would tend to agree that this seems like the simplest approach and would probably be the best bang (helping people) for the (regulatory) buck. It essentially becomes UBI for older folks. Personally (and I realize this goes against a lot of the HN values here), I'd like to see some form of reduced benefit paid out if people are already earning income. If social security guaranteed a minimum monthly income, but didn't pay out what you were already making in other income, it would both help to maintain solvency of the program, and also encourage older folks to retire and make more room for younger people to move up in the workforce. The big problem with that approach is I imagine it would probably cost more to police than it would save, and there are likely some unforeseen consequences to the way it would encourage people to act.
- dragonwriter 10y ago
  > Personally (and I realize this goes against a lot of the HN values here), I'd like to see some form of reduced benefit paid out if people are already earning income. We do that without complicating benefit calculation by way of income taxes. It might be desirable to redirect the additional income tax resulting from that policy back into the OAS trust fund rather than the general fund, though. https://faq.ssa.gov/link/portal/34011/34019/article/3831/must-i-pay-taxes-on-social-security-benefits https://faq.ssa.gov/link/portal/34011/34019/article/3831/mus...