Great read, thank you James! Question here that always puzzled me - the limit at which the contributions stop. In 2024 it is $168,600. One would think that inreasing this limit, or eliminating it alltogether could help with the deficit and make it more fair with wealthy earners contributing at the same rate as the lower paid earners. I don't see even Democtrats suggesting this seemingly very obvious measure. Is this some sort of "taboo"?
Thank you Natalia and good question! Any way you cut it., it would be seen and argued to be a ‘tax increase’. I mean, even suggesting increasing this cap raises a number of potential issues, like: opposition from high earners, partisan divides, potential economic impacts (taxes are negative for productivity, remember…and this is a payroll tax), broader tax policy implications (what about taxing more for the deficits we are running, too???), equity and redistribution concerns (higher taxes for higher earners ‘directly supports’ those earning less), intergenerational fairness (Boomers and Gen-X benefit from Millenials and Gen-Z going forward, etc.)…you get the point. It is fraught with potential fights.
Great read, thank you James! Question here that always puzzled me - the limit at which the contributions stop. In 2024 it is $168,600. One would think that inreasing this limit, or eliminating it alltogether could help with the deficit and make it more fair with wealthy earners contributing at the same rate as the lower paid earners. I don't see even Democtrats suggesting this seemingly very obvious measure. Is this some sort of "taboo"?
Thank you Natalia and good question! Any way you cut it., it would be seen and argued to be a ‘tax increase’. I mean, even suggesting increasing this cap raises a number of potential issues, like: opposition from high earners, partisan divides, potential economic impacts (taxes are negative for productivity, remember…and this is a payroll tax), broader tax policy implications (what about taxing more for the deficits we are running, too???), equity and redistribution concerns (higher taxes for higher earners ‘directly supports’ those earning less), intergenerational fairness (Boomers and Gen-X benefit from Millenials and Gen-Z going forward, etc.)…you get the point. It is fraught with potential fights.
As far as I know, nowadays only Qataris and Norwegians can stay calm in that matter. Here in Poland we have similar worries....