Repealing the Payroll-Tax Cap Won’t Save Social Security

Funding progressive dreams doesn’t mean just raising Elon Musk’s taxes.

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(Picture via Getty Images)

Gail Collins, one of the most tedious repeaters of cheap partisan talking points in the business, has some thoughts about Social Security. 

In one of her regular New York Times conversations with Bret Stephens—the asymmetry in partisanship is dramatic—Collins says:

[M]y top priority for fixing government finances is to get the rich to pay their fair share of Social Security taxes. … Right now, the Social Security tax cap is so low that anybody who’s made a million dollars or more this year has already maxed out. You and I are getting taxed right now, but Elon Musk isn’t.

This is, of course, nonsense. 

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  1. Avatar photo
    Andrew

    I do find myself in a rare bit of disagreement with Mr. Williamson here; while I am under no illusions that removing the payroll tax cap would have any long-term benefit, 13 years isn't nothing, and I find it hard to justify the cap in the first place. Without the cap, the payroll tax would actually be about the closest thing we'd have to a "fair" tax in that everyone pays the same rate. I don't know the history behind the cap, but I suspect that it 1) justifies a top limit on eventual social security payments (more on that in a sec) and 2) was therefore a necessary bit of sustaining the fiction that I am "paying into an account" through the payroll tax, rather than being taxed to pay for current retirees. It's also hard to fathom why those who are comfortably well off in their retirements need to *receive* a government-funded pension, aside from the whole "well, I paid into it" fiction.

    Personally, I'd far rather scrap the entire system and replace it with a need-based pension system for retirees paid out of the general fund, and dispense with this ludicrous fiction altogether. But we clearly have no interest in actually solving the problem. Luckily for me, I've long past assumed that the program is going to fail well before I retire mid-century.

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  2. Ed_Hist

    Does Elon Musk take a salary? Some of those stock billionaires don't.

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  3. Avatar photo
    Ben Connelly

    “ Gail Collins, one of the most tedious repeaters of cheap partisan talking points in the business, has some thoughts about Social Security.”

    Man! What I love most about your writing (and your appearance on podcasts), Kevin, is that you don’t have any hesitation about saying exactly what you think. I guess you’ve reached the age where you don’t care about niceties. Then again, while I wasn’t reading you when you first started at NR (because I think I was maybe in elementary school), I suspect you hit that age around 30. Which I guess is good news for me since it means I don’t have to wait too long to be there myself!

    “ New York magazine put the salary for a high-end columnist at around $350,000, and that was way back in 2000.”

    What the f***? Are you kidding me? I assumed the money was good but that’s crazy!

    “ Megan McArdle of the Washington Post once observed that in Washington, “rich” is defined as anything more than two married high-end journalists make.”

    Putting me in mind of Rusty Reno, who recently said we should draft everyone making ~$4,000 more than him and up - speaking of imbecilic class warfare.

    “ As it stands, those with above average incomes pay essentially all of the federal income tax—the top 50 percent pays 98 percent of the income tax, and the top 1 percent pays 42 percent of the income tax, which is about twice its share of income.”

    This was a point my dad used to talk about back during the Bush years and it might be why I’ve never had much time for class warfare (envy politics).

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  4. Token Liberal

    The basic problem is that we want stuff and we don't want to pay for it. So we get the "tax the rich" rhetoric instead of serious policy. Our elected officials pander to us because those that don't are not going to win elections. Why don't they win? Because we want stuff and don't want to pay for it. The only mystery to me is that the whole house of cards hasn't collapsed yet.

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  5. Mctaglieri

    Kevin Williamson's rant about Gail Collins as "one of the most tedious repeaters of cheap partisan talking points" doesn't affect the fact that she's right and he's wrong. Repealing the cap would buy Social Security 13 more years of solvency. Maybe by then the Republican party will again be run by the grownups and we can have a more permanent fix.

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    1. Avatar photo
      Lchrisberg

      Um.... it was Reagan and the GOP that saved SS last time and it's Jello Joe that is insisting it not be touched under his watch.

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  6. Susan Connelly

    I read the weekly NYT Stephens/Collins column only because Bret is unfailingly intelligent, interesting, and open-minded. He is also exceedingly patient with Gail’s reflexively partisan, intellectually vacuous commentary. However a few weeks back he described his “jaw hitting the floor”(https://www.nytimes.com/2023/03/13/opinion/tucker-carlson-joe-biden-budget.html?smid=nytcore-ios-share&referringSource=articleShare) when she (not surprisingly) made clear that in fact she didn’t really think Trump was all that bad, at least compared to Desantis, who of course is now the greatest threat humanity has ever faced. Her exact comment: “Oh, Bret, it’s so hard to admit I’d rather see Trump as the nominee than DeSantis, but it’s true. I would. Rather have a terrible Republican with no real fundamental values than one who has strong but terrible commitments and is a genuine obsessive on social issues like abortion rights.” Bret has been consistent in his disdain for Trump, and for once he seemed to realize he was dealing with a purely partisan hack.

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    1. R. Rice

      What a crazy team that is. Stephens is serious, and catches serious flak relentlessly for being the closest thing to right of center the NYT has. Collins gets away with complete utter silliness over and over - because 1) the readers like her position, or rather she knows what position the readers will like; and 2) her shtick is cute and witty. It is painful.

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    2. Philip.R.M.Hunt

      Instead of partisan hack, it could be that Collins is herself the genuine obsessive on abortion rights. Trump’s attempts to be an autocrat and his contempt for rule of law seem to mean nothing to her. It seems that all that matters to her is that she likes Trump’s abortion position better than DeSantis’s. Policy-wise Trump is more moderate than most establishment Republicans or the freeDUMB caucus.

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  7. Esther G

    I don’t have any great ideas about fixing Social Security or what a “fair share” is. My only thought is I prefer journalists not refer to another journalist’s ideas as “imbecilic hypocrisy”. Kevin can disagree and make his case without sounding mean-spirited. I have been guilty of using mean-spirited language regarding the thoughts of Trump supporters, but I am trying my best to not do that anymore. If we all try to be better about this, maybe the country will slowly be less divided. I had to admit to myself that I was perpetuating the problem.

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      Richard Maxton

      On the other hand, I enjoy the shoot from the hip, calls 'em like he sees 'em bluntness. And I don't think "imbecilic hypocrisy" is mean-spirited unless he can't back it up.

      Which he did here.

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      1. Esther G

        To each his own. Personally, I’d rather someone refer to my thinking as wrong rather than imbecilic. Americans might get along better that way. My mother always told me to never use the word “stupid”. My guess is Kevin’s baby won’t be encouraged to call other toddlers imbeciles.

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          Richard Maxton

          If it's simply about a difference of opinion, I wouldn't use "imbecilic" or "stupid". Once you've crossed into hypocrisy though, my patience and inclination to politeness for politeness' sake diminishes greatly.

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    Stuart Wilder

    The real reason we remember the 1950s as Arcadian days is the taxes were high enough on everyone to fund good public schools, a space program, a decent national defense, and public health programs like mass distribution of polio, measles, and other vaccines to a public eager not to get diseases. Oh, and the grumpuses were the John Birch Society, the Ku Klux Klan, and left-wing midgets like the Communist Party and whatever the nudists called themselves. Most everyone trusted government. Even Barry Goldwater came around.

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    1. Ed_Hist

      Would you favor a return to the spending we did in the 1950s? No Great Society programs, no Department of Education, etc.
      Oh and a big reason that the 1950s were an economic success for the U.S. was that most of the rest of the advanced world had spent years flattening each other in the previous decade.

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      Lchrisberg

      "The real reason we remember the 1950s as Arcadian days is the taxes were high enough on everyone to fund good public schools, a space program, a decent national defense, and public health programs like mass distribution of polio, measles, and other vaccines to a public eager not to get diseases"
      Wrong. The effective tax rates have changed little over time.

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    3. Stevenreedcurtis

      Government expenditures as a percentage of GDP are higher now than in the 50s. Government tax rates as a percentage of GDP are more similar to the 50s. Deficit spending, taxing our children.

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  9. Betsybowditch

    Ten years ago, I was in New Brunswick Canada with my father and he tallied the tax rate, which includes both provincial and federal, on a lunch tab as 27 percent, which is much more than we pay south of the border.

    We met a number of Canadians, who spend winters in Florida, who said they would love to keep the programs they enjoy but pay American taxes. Can't be done.

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  10. Kgfroehle

    Taxes. Right next to theology as a subject for fisticuffs. I love it! Let me buy you a beer, and then fight about something!

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