In a long, detailed, entitlement reform paper at Newt.org, Gingrich in fact proposes eventually expanding such accounts ultimately to finance all the benefits now financed by the payroll tax, with the accounts finally displacing the payroll tax entirely with a personal, family wealth engine instead.
FORBES: Gingrich Schools Santorum And Romney On Social Security
To avoid this, Mr Bush wants to create private accounts: workers would put some of their payroll taxes into personal accounts that would be theirs on retirement.
Among the highest income one percent, the payroll tax cut accounts for only about 0.1 of a point of that total 4.5 percent increase.
Democrats have attacked Bush's plan for private accounts, charging that diverting payroll taxes would threaten retirees' benefits and that transition costs to the new system would drive up the deficit.
Though his convention speech talked of diverting payroll taxes to individual accounts, nothing was in it about reducing Social Security benefits.
Workers under the proposed plan were empowered to choose to save and invest in the accounts just half the Social Security payroll tax.
This would mean partially privatising Social Security, letting people set up individual retirement accounts and use part of their payroll taxes (which now fund Social Security) to invest in the stockmarket.
ECONOMIST: Why George Bush needs to be careful, rather than daring
But instead of permitting workers to put only 2% to 4% of their payroll tax into personal accounts, as the Administration proposed in 2001, why not increase that to 8% or more?
Allowing workers to place half the payroll tax into such accounts to pre-fund their retirement would bring to fruition Abraham Lincoln's vision of the true American dream by making every worker an owner.
Martin Feldstein, a pensions expert from Harvard University and a Bush adviser, argues (in a new paper written with Andrew Samwick of Dartmouth College) that diverting 2% of payroll taxes into private accounts would not mean a cut in overall retirement benefits.
ECONOMIST: Social Security reform: The battle of the boffins | The
The solution for them is to funnel about half of their payroll taxes into personal retirement accounts.
It would alter Social Security for those under age 55 by letting people put some of their payroll taxes in personal investment accounts.
FORBES: Suddenly, Democrats Are Making Noise About Ryan's Roadmap
The Administration is toying with the idea of permitting people to have up to 4 percentage points of that payroll tax go into personal accounts.
In the cities the main system combines social insurance, paid for by payroll taxes, with individual accounts, into which workers must pay 8% of their earnings.
Experts on the right periodically trot out analyses that show that workers would be better off if they could invest their payroll taxes in private retirement accounts.
FORBES: Why Americans Are Skeptical About Private Social Security Accounts
We should then allow a personal account option for younger workers for this portion of the payroll tax, with the accounts taking responsibility for paying an equivalent proportion of future Social Security benefits.
Eventually, the accounts could be expanded to cover the payroll taxes for Medicare, another 2.9% of wages, with the saved funds financing monthly annuity benefits used to purchase private health insurance in retirement.
Bush's opposition deprives the commission of one source of revenue to shore up the program's finances so that Social Security can cover the cost of allowing younger workers to invest a small portion of their payroll taxes in private investment accounts.
Because the long term returns from real savings and investment are so much higher, saving and investing over a lifetime the 2.9% Medicare payroll tax in the personal accounts would produce an income stream in retirement roughly three times as large as the uninvested, tax and spend, purely redistributive, pay-as-you-go Medicare payroll tax today.
Jim Kolbe, R-Arizona, and Charles Stenholm, D-Texas, would create private accounts financed by 2 percent of the existing payroll tax.
The need for this transition financing phases out over time as workers retire relying on their personal accounts to at least some degree instead of payroll taxes.
He wanted to put the system on a sound financial footing and, at the same time, allow Americans to use part of their payroll taxes to fund personal retirement accounts.
Taxes too, for the accounts could be expanded over time to replace the payroll tax entirely.
FORBES: The New Republican Vision For Modern Social Safety Nets
Over time, these personal accounts can and should be expanded to replace the payroll tax entirely, financing all of the benefits currently financed by the payroll tax through market savings, investment and insurance.
Allowing workers to choose personal savings and investment accounts in place of some and eventually all of the payroll tax, a booming economy will make retirement all the more prosperous.
FORBES: Economic Growth, Not Income Redistribution, Is What Helps Us All
Given that perspective, why shouldn't we phase in a new Social Security system for younger people, in which the bulk of their payroll taxes would go to their own retirement accounts?
With the accounts paying for all of the benefits currently financed by the payroll tax, that tax would eventually be phased out altogether.
What share of payroll-tax contributions would be diverted into private accounts?
As for Social Security, Ryan modestly scaled back his original proposal by reducing the amount invested in private accounts, from one-half to one-third of payroll taxes.
Experts say other whistleblowers are waiting for what they hope are imminent payments on large issues as varied as payroll tax withholding, tax shelters, illicit foreign accounts or arcane corporate accounting matters like transfer pricing.
应用推荐