"Estimates of the Social Security shortfall over the next 75 years are between 2 and 3.7 $trillion."
75 years out, GDP should do about 100 trillion a year (in today's money): 4 times the GDP per person (GDP per person doubles every 40 years); 2 times the number of persons (population doubles every 80 years) -- today, 12.5 trillion dollars.
75 years out the GDP may GROW between 2 and 3.7 trillion dollars every year or so!
Social Security is taxed regressively and paid out progressively. Does that make it a flat tax? Someone pointed out to me that the top still subsidizes the bottom, so I guess it's a flatter tax.
Right now the top 1% of incomes have been raking in the lions share of all economic growth for over three decades.
Top 1% incomes took 7.6% of overall income in 1972 (just before the race to the wage and benefit bottom began* -- in America, not in Europe where sector-wide labor agreements prevent same*), by 2001 the top 1% took in 17.6% , by 2005 they took 21.5%: very possibly on their way to 27.6% within a short timeline.
Until the race to the bottom is dealt with on this side of the pond, removing the FICA cap might be a good idea, like anything else that partially rebalanced some income misdistribution -- just because it rebalanced it some.
had-adam-smith-lived-to-see-1800s.htmlPosted by: Denis Drew on November 28, 2007 at 3:16 PM | PERMALINK