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re: The Coming Social Security Crisis
Posted on 3/28/24 at 12:12 pm to RoosterCogburn585
Posted on 3/28/24 at 12:12 pm to RoosterCogburn585
Tax Chats episode 97 is a fantastic overview of what is happening.
Duke and UNC tax professors have a guest who is well informed on the subject.
Points of discussion:
Tax revenue
Spending
Debt
Interest on debt
The relation of all of the above to GDP.
The reason why if we keep going the way we are going, we will be broke/hit an actual crisis.
They discuss a few things that are possible. The goal even in the calculations isn’t to eliminate debt or balance the budget but something like stabilizing debt held by the public at about 95% of GDP (where it is now). Ok to run deficit of GDP around 3%.
The way to achieve this (not the only way, but a reasonable way (which they admit is never going to happen)) is to add about 6% of GDP to the budget (by cutting programs or adding tax revenue) by around the 2040s. It’s about $1.5T (annually).
The fun math numbers they pull out (not advocates of the idea. Just using math to prove (or disprove) the political talking points:
30% minimum tax to “millionaires” would raise $66BN per DECADE (0.03% of GDP)
Raise corporate rate 21–>35%? You get 0.5% of GDP (from a purely static calculation, excluding the ones who would leave and assuming nothing changes)
An amusing mathematics equation: if you confiscated 100% of earnings >$1MM and no behaviors changed, you hit 3.7% of GDP.
Same but $500K, 5%
Lift the SS cap from payroll taxes? 0.8%
Double the top 2 tax brackets (and the FICA above) ? 1.5% of GDP
The extreme measures needed to hit 6% in combination (that he throws around as “the most reasonable (of the batshit insane ways you could even figure out how to do it)”):
20% VAT will get you 3%
Hike payroll tax 9% for everyone
Wealth tax 20%
Duke and UNC tax professors have a guest who is well informed on the subject.
Points of discussion:
Tax revenue
Spending
Debt
Interest on debt
The relation of all of the above to GDP.
The reason why if we keep going the way we are going, we will be broke/hit an actual crisis.
They discuss a few things that are possible. The goal even in the calculations isn’t to eliminate debt or balance the budget but something like stabilizing debt held by the public at about 95% of GDP (where it is now). Ok to run deficit of GDP around 3%.
The way to achieve this (not the only way, but a reasonable way (which they admit is never going to happen)) is to add about 6% of GDP to the budget (by cutting programs or adding tax revenue) by around the 2040s. It’s about $1.5T (annually).
The fun math numbers they pull out (not advocates of the idea. Just using math to prove (or disprove) the political talking points:
30% minimum tax to “millionaires” would raise $66BN per DECADE (0.03% of GDP)
Raise corporate rate 21–>35%? You get 0.5% of GDP (from a purely static calculation, excluding the ones who would leave and assuming nothing changes)
An amusing mathematics equation: if you confiscated 100% of earnings >$1MM and no behaviors changed, you hit 3.7% of GDP.
Same but $500K, 5%
Lift the SS cap from payroll taxes? 0.8%
Double the top 2 tax brackets (and the FICA above) ? 1.5% of GDP
The extreme measures needed to hit 6% in combination (that he throws around as “the most reasonable (of the batshit insane ways you could even figure out how to do it)”):
20% VAT will get you 3%
Hike payroll tax 9% for everyone
Wealth tax 20%
Posted on 3/28/24 at 12:36 pm to Hopeful Doc
quote:
The fun math numbers they pull out
None of these "fun math numbers" that you're giddy about even account for the 10's of thousands of illegals that come across every single day. When you're ready for a serious root cause debate which includes Potato reaching across the aisle to the Senate Committee on Finance, let me know. In the meantime you and the other academia useful idiots can continue playing GoodWill Hunting fun math in your think-tank echo chambers. Good luck with that.
This post was edited on 3/28/24 at 12:38 pm
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