I was just perusing some financial web sites this morning, and ran across several articles pertinent to this thread.
One factoid that surprised me. In 1983, 90% of all wages were subject to Social Security taxes (i.e., were under the cap, which was only $35,700 at the time). If you wanted to raise today's cap so that 90% of wages were taxed, you'd have to raise it to $270K.
http://time.com/money/4644332/maximum-social-security-benefit-2017/
That article references this scholarly publication, which confirms the $270K:
https://www.cbpp.org/research/socia...ayroll-taxes-would-strengthen-social-security
It discusses various proposals to increase SS revenue. I didn't realize that there were serious proposals to raise the wage limit subject to taxes, while keeping the old limit in the benefit calculation. That strikes me as eminently unfair. But there are also proposals to raise the wage limit, but include those wages in the benefit calculation, which strikes me as the fair way to do it. The article estimates that this would close about one quarter of the SS revenue gap.
The article also discusses proposals to include more fringe benefits in taxable SS wages, such as your employer-sponsored medical insurance. I hate that idea. As it is, I think that the 1983 change to tax 401(k) contributions was outright wrong. I don't think they should double-down on a bad idea.
One factoid that surprised me. In 1983, 90% of all wages were subject to Social Security taxes (i.e., were under the cap, which was only $35,700 at the time). If you wanted to raise today's cap so that 90% of wages were taxed, you'd have to raise it to $270K.
http://time.com/money/4644332/maximum-social-security-benefit-2017/
That article references this scholarly publication, which confirms the $270K:
https://www.cbpp.org/research/socia...ayroll-taxes-would-strengthen-social-security
It discusses various proposals to increase SS revenue. I didn't realize that there were serious proposals to raise the wage limit subject to taxes, while keeping the old limit in the benefit calculation. That strikes me as eminently unfair. But there are also proposals to raise the wage limit, but include those wages in the benefit calculation, which strikes me as the fair way to do it. The article estimates that this would close about one quarter of the SS revenue gap.
The article also discusses proposals to include more fringe benefits in taxable SS wages, such as your employer-sponsored medical insurance. I hate that idea. As it is, I think that the 1983 change to tax 401(k) contributions was outright wrong. I don't think they should double-down on a bad idea.