Regarding President Bush’s $1.6 trillion dollar tax cut, I feel compelled to throw my two cents into the debate. I’m really not against the idea of a tax cut, or for that matter, the president’s plan to invest part of my Social Security money into the stock market. However, I would much rather see our country’s huge federal deficit paid off first. In my case, I would benefit a lot more in the long run with lower interest rates rather than a few hundred dollars a year in a tax cut.
With that said, I can’t help but wonder if there isn’t another way to accomplish most of the president’s objectives while still being careful with a projected budget surplus that may or may not pan out. So here is what I would like to see happen.
For starters, leave Social Security just the way it is. If the government wants to invest some of my money in the stock market, fine, do it! But start with that $300 rebate you’re talking about giving back to me this year. Let’s call it a Social Security 401K. And in the future if the country really can afford more refunds, then just keep adding them to this Social Security 401K account. And if it becomes apparent that we really can take 2 percent of everyone’s social security taxes without harming the trust fund, then my account as well as everyone else’s is already there and open. This would serve many people much better, I believe, than the plan that is currently being debated.
Even the extremely well off portion of the population would benefit greatly from this as all that new money would spur on business growth while increasing the current sagging stock market. I call this trickle up economics – where everyone, rich and poor, really would benefit in the long run.
I honestly believe, since everyone benefits, this would be fair for all Americans who pay taxes. It also controls tax returns as long as a budget surplus exists. If the surplus falls short due to a recession or other emergency, then the refunds could be curtailed or reduced until such a time that conditions improve. And if the surplus continues to balloon then the refunds could be increased to a higher level.
Who knows? Starting a Social Security 401K tax refund program as I have outlined here might eventually give the president and the Republican Party a tax cut far in excess of the $1.6 trillion that they’re trying to achieve at present. Especially if you factor in the business growth that would occur with the increased investments.
And finally, if most people are lacking in retirement savings as much as I am, and I assume many are, then this is a good and solid plan for the future of all Americans.