Financial Transfer Tax Is A Win For Wall Street – Adopt The BEST Social Security Mod Plan

Financial Transfer Tax Is A Win For Wall Street – Adopt The BEST Social Security Mod Plan

Transfer tax: http://www.commondreams.org/view/2014/02/19-9

Adopting a Wall Street “transfer tax” would amount to a big win for Wall Street. Why? A better “fix” to the problem would be to adopt The BEST Social Security Modernization Plan. The BEST Plan opts to treat all income that is “earned” equally and to require these earnings such as short term capital gains and rental income to pay the compulsory Social Security payroll tax or self employment tax like other forms of earned income are required to pay. Once these “earnings” are subject to paying the Social Security tax, they will also be additionally taxed, for purposes of federal income taxes, at the same rate that currently defined wages and self employment earnings are taxed, not some currently artificial 10 or 15% total amount. 

Why should earning money as a result of “working” as a result of financial investment as opposed to physical labor or using one’s mental capabilities or using a combination of physical and mental abilities be taxed any differently?

These financial mode earnings are currently excluded from paying Social Security taxes and the wage rate federal income taxes as a result of a glitch in the Social Security Act which gives them preferential treatment. Repealing Section 211 (a) 1, 2, and 3 of the Social Security Act will remove the glitch.

This is not even a new tax. It would result in requiring all Americans to pay taxes at the same progressive rates.

Compared to implementing The BEST Social Security Modernization Plan, installing a new, artificial transaction tax on Wall Street transactions would prevent having Social Security and Federal Income Taxes that treat all Americans fairly and equally.

To learn more details about The BEST Social Security Modernization Plan read all the posts starting in late November 2013 here: www.bestsocialsecuritymodplan.blogspot.com

The 1 Percent “Work” Harder? – Support For The BEST Social Security Mod Plan!

The 1 Percent “Work” Harder? – Support For The BEST Social Security Mod Plan!

 As recently reported by the Huffington Post, http://www.huffingtonpost.com/2014/02/05/sam-zell-1-percent_n_4733196.html Sam Zell defended recent comments by Tom Perkins and was quoted as saying, "The 1 percent work harder. The 1 percent are much bigger factors in all forms of our society."

In addition to proposing a three tier Social Security payroll tax rate, one of the basic tenets of the BEST Social Security Modernization Plan is eliminating the loophole found in Section 211 (a) 1, 2, & 3 of the Social Security Act which excepts rental income, dividends and capital gains from paying the otherwise compulsory Social Security payroll and self employment taxes.

So what did Mr. Zell say? He said the 1 percent “work,” and they “work harder.”

Certainly one can also make the case that many if not most of the 99 percent work very, equally hard, but I certainly agree that the 1 percent “work.”

Some workers work using their physical skills. Others work using their mental abilities. Others work using a combination of physical and mental skills. However, the 1 percent’s preferred mode of work is using their wealth to work and this work should be subject to paying the 6.2%/12.4% Social Security payroll/self-employment taxes and that once, this form of “Zell defined work” is defined as work, as wages, as self-employment income, this income should be subject to paying federal income taxes at the same tax rates that every working man pays their income taxes.

Thank you, Mr. Zell for justifying and buying into the BEST Social Security Modernization Plan.

Now, if we can only get Congress and President Obama to see the light and support the BEST Mod Plan.

It’s a no brainer! Or is that is the etiology of the problematic resistance?

Another Archival Summary of the BEST Social Security Mod Plan

Another Archival Summary of the BEST Social Security Mod Plan

For more details on the plan, please read my earlier posts!

Historical Background

Since Social Security’s inception in 1935, many changes have been made to the program. Some examples are adding disability benefits, the Supplemental Security Income program, Medicare, and mandating coverage for the self-employed and employees of non-profit organizations.

What It Does

·          Improves long range solvency of the Social Security Trust Funds.

·          Adds progressivity to Social Security taxation.

·          Welcomes new groups of workers into the Social Security program.

·          Serves to stabilize the economy.

·          Slows the inflation of real estate values.

·          Inspires new confidence in the Social Security program.

What It Does Not Do

·          It does not remove the Social Security wage/coverage cap.

·          It does not increase the retirement age.

·          It does not reduce the amount of retirement benefits.

How Does It Do It?

·          Lowers the payroll tax rate for workers/self-employed who earn at or below minimum wage levels from 7.65%-15.3% respectively to 4.65%-9.3%.

·          Increases the payroll tax for that portion of earnings which exceed the curent maximum covered base from 7.65%-15.3% to 9.65%-17.3%, using current methodology for cap increases, over a 10 year rolling period.

·          Adds three new categories of work which will be subject to Social Security coverage: Short term capital gains, all rentals from real estate, and working for state & local employers currently not covered by Social Security for the first five years of employment.

Who Does It Affect?

·          Having an equitable, progressive, solvent Social Security program affects everyone.

·          Those who work in real estate rentals and in the businesses of short term investing, and currently non-covered state and local employers and employees.

·          Higher wage earners who earn in excess of the current Social Security maximum.

·          Minimum wage earners, young workers starting to work, and retired part-time workers.

·          Start-up businesses whose profits are at minimum wage levels.

The Minimum Wage & The BEST Social Security Modernization Plan

The Minimum Wage & The BEST Social Security Modernization Plan

Should the minimum wage be raised? H*ll. Y*s! Saying that minimum wages should be kept inhumanly low because minimum wage jobs should be stepping jobs to higher ($.25 an hour more?) paying jobs is ridiculous.

Any job that exists is worth doing well, and it should be capable of instilling pride in doing it right and in the job for its workers.

Here is an example: On my monthly wild spending spree, I go to Taco Bell ™ and order the usual Fresco bean burrito and a Fresco chicken soft taco. What’s different today? It tastes really good. Why? For one, the food prep specialist (fps) gave me exactly what I ordered, and it tasted really good, today. Why? The fps made my order exactly at Taco Bell ™ intended, (I did not get someone else’s order, either!) no sour cream, no heavy cheese, and included the diced tomatoes and cilantro, etc.

On my way home, the grocery sack boy (I, proudly, was one, once!) didn’t put my loaf of bread under my six pack of Pabst ™ or next to my bars of soap. Good job!

All workers should be held accountable, but they should also be properly trained, and they should be motivated sufficiently to want to do a good job. Paying just and fair wages can help motivated workers.

Companies can benefit, too, by paying higher wages. Less job turnover and time spent training and supervising saves money. Competent employees help businesses grow and thrive.

Every worker should be able to work any job with dignity, provide for food clothing and shelter, and keep that job if that is what they want to do.

The last time the minimum wage permitted someone to do that was during the 60’s around the time of the Johnson administration.

Workers should not have to hold two or three jobs just to get by.

How would paying a living minimum wage (higher minimum wage) affect the BEST Social Security Modernization Plan?

An increase of the minimum wage from its current $7.25 per hour to $11.00 per hour would generate a 52% increase of payments into the Social Security trust fund from minimum wage workers and employers. Admittedly, minimum wage jobs represent a small percentage of the working force and wages and self-employment earnings, but there is no one thing, alone, which will make Social Security fully solvent and capable of expansion.

Every little bit helps! So, go for it!

Here is a Bureau of Labor Statistics table that shows the percentage of minimum wage workers by state:

Table 1. Employed wage and salary workers paid hourly rates with earnings at or below the prevailing Federal minimum wage by State, 2012 annual averages
State	Number of workers (in thousands)				Percent distribution				Percent of workers paid hourly rates
	Total paid hourly rates	At or below minimum wage			Total paid hourly rates	At or below minimum wage			At or below minimum wage
		Total(1)	At minimum wage	Below minimum wage		Total(1)	At minimum wage	Below minimum wage	Total (1)	At minimum wage	Below minimum wage
Total, 16 years & up	75,276	3,550	1,566	1,984	100.0	100.0	100.0	100.0	4.7	2.1	2.6
Alabama	1,083	65	31	34	1.4	1.8	2.0	1.7	6.0	2.9	3.1
Alaska	194	2	1	1	0.3	0.1	0.1	0.1	1.0	0.5	0.5
Arizona	1,472	68	17	51	2.0	1.9	1.1	2.6	4.6	1.2	3.5
Arkansas	725	50	33	17	1.0	1.4	2.1	0.9	6.9	4.6	2.3
California	8,805	127	45	82	11.7	3.6	2.9	4.1	1.4	0.5	0.9
Colorado	1,234	42	7	35	1.6	1.2	0.4	1.8	3.4	0.6	2.8
Connecticut	853	23	2	21	1.1	0.6	0.1	1.1	2.7	0.2	2.5
Delaware	219	11	4	7	0.3	0.3	0.3	0.4	5.0	1.8	3.2
District of Columbia	103	5	1	4	0.1	0.1	0.1	0.2	4.9	1.0	3.9
Florida	4,164	214	49	165	5.5	6.0	3.1	8.3	5.1	1.2	4.0
Georgia	2,114	136	60	76	2.8	3.8	3.8	3.8	6.4	2.8	3.6
Hawaii	331	14	7	7	0.4	0.4	0.4	0.4	4.2	2.1	2.1
Idaho	404	31	16	15	0.5	0.9	1.0	0.8	7.7	4.0	3.7
Illinois	3,065	85	21	64	4.1	2.4	1.3	3.2	2.8	0.7	2.1
Indiana	1,785	93	50	43	2.4	2.6	3.2	2.2	5.2	2.8	2.4
Iowa	920	46	25	21	1.2	1.3	1.6	1.1	5.0	2.7	2.3
Kansas	780	44	29	15	1.0	1.2	1.9	0.8	5.6	3.7	1.9
Kentucky	1,147	60	30	30	1.5	1.7	1.9	1.5	5.2	2.6	2.6
Louisiana	1,043	74	35	39	1.4	2.1	2.2	2.0	7.1	3.4	3.7
Maine	378	11	3	8	0.5	0.3	0.2	0.4	2.9	0.8	2.1
Maryland	1,327	67	25	42	1.8	1.9	1.6	2.1	5.0	1.9	3.2
Massachusetts	1,567	62	17	45	2.1	1.7	1.1	2.3	4.0	1.1	2.9
Michigan	2,449	90	19	71	3.3	2.5	1.2	3.6	3.7	0.8	2.9
Minnesota	1,522	60	35	25	2.0	1.7	2.2	1.3	3.9	2.3	1.6
Mississippi	700	45	21	24	0.9	1.3	1.3	1.2	6.4	3.0	3.4
Missouri	1,538	97	49	48	2.0	2.7	3.1	2.4	6.3	3.2	3.1
Montana	274	4	1	3	0.4	0.1	0.1	0.2	1.5	0.4	1.1
Nebraska	561	32	17	15	0.7	0.9	1.1	0.8	5.7	3.0	2.7
Nevada	730	23	9	14	1.0	0.6	0.6	0.7	3.2	1.2	1.9
New Hampshire	370	13	5	8	0.5	0.4	0.3	0.4	3.5	1.4	2.2
New Jersey	1,777	103	49	54	2.4	2.9	3.1	2.7	5.8	2.8	3.0
New Mexico	488	23	6	17	0.6	0.6	0.4	0.9	4.7	1.2	3.5
New York	4,075	224	113	111	5.4	6.3	7.2	5.6	5.5	2.8	2.7
North Carolina	2,206	137	74	63	2.9	3.9	4.7	3.2	6.2	3.4	2.9
North Dakota	205	7	3	4	0.3	0.2	0.2	0.2	3.4	1.5	2.0
Ohio	3,277	147	31	116	4.4	4.1	2.0	5.8	4.5	0.9	3.5
Oklahoma	890	64	29	35	1.2	1.8	1.9	1.8	7.2	3.3	3.9
Oregon	982	11	3	8	1.3	0.3	0.2	0.4	1.1	0.3	0.8
Pennsylvania	3,450	195	87	108	4.6	5.5	5.6	5.4	5.7	2.5	3.1
Rhode Island	298	10	2	8	0.4	0.3	0.1	0.4	3.4	0.7	2.7
South Carolina	1,084	59	28	31	1.4	1.7	1.8	1.6	5.4	2.6	2.9
South Dakota	253	12	6	6	0.3	0.3	0.4	0.3	4.7	2.4	2.4
Tennessee	1,554	86	46	40	2.1	2.4	2.9	2.0	5.5	3.0	2.6
Texas	6,060	452	282	170	8.1	12.7	18.0	8.6	7.5	4.7	2.8
Utah	758	37	21	16	1.0	1.0	1.3	0.8	4.9	2.8	2.1
Vermont	184	5	1	4	0.2	0.1	0.1	0.2	2.7	0.5	2.2
Virginia	1,803	123	48	75	2.4	3.5	3.1	3.8	6.8	2.7	4.2
Washington	1,705	29	11	18	2.3	0.8	0.7	0.9	1.7	0.6	1.1
West Virginia	453	26	13	13	0.6	0.7	0.8	0.7	5.7	2.9	2.9
Wisconsin	1,745	94	41	53	2.3	2.6	2.6	2.7	5.4	2.3	3.0
Wyoming	173	9	4	5	0.2	0.3	0.3	0.3	5.2	2.3	2.9
(1) Data may not add to totals due to rounding.
NOTE: Data exclude all self-employed persons whether or not their businesses are incorporated. Users are reminded that these data are based on a sample and therefore are subject to sampling error; the degree of error may be quite large for less populous States. It is not possible to determine clearly whether workers surveyed in the CPS are actually covered by the Fair Labor Standards Act (FLSA) or by individual State minimum wage laws. Thus, some workers reported as earning the prevailing Federal minimum wage may not in fact be covered by Federal or State minimum wage laws. Also, there are a number of States that have minimum wages that exceed the Federal minimum wage. At the same time, the presence of a sizable number of workers with wages below the prevailing Federal minimum wage does not necessarily indicate violations of the FLSA or applicable State laws, because there are numerous exclusions and exemptions to these minimum wage statutes. Hourly earnings do not include overtime pay, commissions, or tips.