Payroll ax: What about the lockbox?EDITORIAL
February 23. 2012 11:44PM
President Obama portrays the payroll tax holiday, now extended through the end of the year, as a tax cut that puts much-needed money in the pockets of working Americans. How odd. Normally, Democrats would frame a reduction in the payroll tax, which directly funds Social Security, as a scheme to defund Social Security.
At least in theory, payroll tax money goes into the so-called Social Security Trust Fund. The payroll tax deal just denied that trust fund billions of dollars, which will have to be replaced with general taxation or borrowed money. So why doesn't Obama get criticized by the mainstream media for picking Al Gore's lockbox?
Because he's a Democrat, for one. Also because the Social Security Trust Fund is a fiction. There is no lockbox. It's all just a game of political make believe.
That is worth remembering the next time Social Security is debated. When Republicans propose allowing people to invest a few percentage points of their Social Security taxes in retirement accounts of their own choosing, Democrats scream that they're destroying Social Security. Then Democrats go and propose letting people spend a few percentage points of their Social Security taxes on anything at all.
At least they've acknowledged that tax cuts help the economy, even if they're cutting the wrong taxes.