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Friday, Nov. 28, 2014

Dude, where's my paycheck?

Thursday, January 17, 2013

Chances are, as you receive your first payroll check of the year, you opened the envelope, gasped like a victim in a cheap horror movie (as did I), figured there must be some mistake, shook it upside down hoping some missing cash might miraculously fall out. And then cried like a schoolgirl in the fetal position for a few hours.

It's the arrival of Washington's dirty little secret, the thing neither campaign was about to tell you a whisper of in the presidential race. You remember all that talk about taxing the rich for a bigger share? Little did you know that the "rich" they were talking about... was you.

It's a huge tax increase - 163 million workers will have an average of a thousand bucks more sucked out of their paychecks over the course of the year at a time when many of them can barely afford food and heat as it is.

Oh, as the national primal scream of angst rises to the heavens, they'll try in patiently sincere, monotone voices to assure you it's NOT a tax increase at all (which is a sure sign that what's happening IS a tax increase.) It was, rather, they will explain, a temporary reduction in Social Security payroll tax that your beloved politicians chose to silently let expire by taking no action to extend it before the year ran out.

It was a strategic decision on their part. Take no vote, have nothing recorded on paper, and no one can be burned in effigy for putting a bigger tax burden on the middle class Americans the candidates fell all over themselves for the past two years pledging to help.

That bite out of your paycheck - another one to go with the cost of food, gas, utilities, education tuition, and on and on - probably makes you want to slap the snot out of everyone you just finished voting for, hard enough that their great-great grandchildren will be born with ringing in their ears.

But, Secret Service frowns on that, or they would if they weren't out searching for hookers. And, truth be told, mostly by pure accident, our so-called leaders have probably done for once the fairly right thing.

Reducing the Social Security tax two years ago didn't make a dent in stimulating an economy more sluggish than your brother-in-law after a football Sunday 24-pack.

And if we are going to have any glimmer of hope that some form of the Social Security system is still going to exist to keep the next generation of workers reaching retirement age from living in cardboard Hoovervilles, we're going to have to pay in our fair share now.

They call what we had in 2011-12 a payroll tax "holiday" - wee, did you have fun rolling around on the sunny resort beach of dollar bills you were allowed to hang onto for a little while longer? All good holidays have to come to an end - you have to give a guy in a mouse costume one last sweaty hug, or down one last watered down boat drink, and return to reality. Continuing the holiday would put the future of an independently-funded Social Security system over the line from in trouble to becoming a figment of your imagination, like bigfoot, jackalopes and Congressional pay freezes.

It's still possible that a new Congress could take up the issue, but nahhh - neither party wants to draw any more attention to a tax beatdown on workaday Americans than it will already be getting - the one that promised "no new taxes" so loudly, or the one that promised it was only going to be the super rich to pay a bigger share.

"I think there's a growing consensus that Congress and the president can't continue to divert such a critical revenue stream from Social Security," said Rep. Kevin Brady of Texas, a senior Republican on the tax-writing House Ways and Means Committee. "I think more and more Americans understand that that payroll tax cut, while politically appealing, is endangering Social Security."

Translation = you're outta luck, pal.

No sense blaming your employer for screwing you over, either. They had nothing to do with it, and they aren't benefitting from it. Your boss is just the messenger, this time.

Social Security is funded by a 12.4 percent tax on wages up to $110,100 (hiked to $113,700 in 2013.) Half is paid by the worker, half by the employer. Over the past two years, Congress and President Obama cut the share paid by workers from 6.2 percent to 4.2 percent. Your employer kept paying their full share for you, and they will continue to.

For a person making $50,000, your every-other-week check should suddenly be about $40 lighter. For a family of four with two wage earners in that category, the damage may be over $4,000 a year - about enough lost that would have covered tuition for a semester to one of the state universities.

Did you save up that cash from the big chunk of taxes you were spared over the past two years? If so, you have a nest egg of perhaps a few thousand bones sitting around in a mattress. But you didn't even know you were harvesting a temporary windfall, probably. And you didn't sock it away in an IRA or a savings CD, did you? You blew it on wild and crazy luxuries like $3.25 gas, 45 cent postage stamps, health insurance for your kids that costs more per month than a lease on a BMW, and Raman noodles, you maniac. Now you are left to pay the piper, when the people you quasi-trusted were oh-so-careful not to tell you that the piper was coming to call.

So what do you cut now? Chances are, most of the luxuries are already history. Date nights at a nice restaurant, the premium movie channels, vacation trips, the gym membership, boxer shorts of the months club - POOF. What happens then? Put off the brake repair your car really needs, the medicine you were really supposed to take, not renew your insurance?

As much as I realize that the Social Security Administration needs our money, it is also clear in communities like this that hundreds of people are living closer and closer to the edge, relying at least in part on food pantry programs to survive, and perhaps one paycheck from being homeless. And still no guarantee that they extra money they hand over for Social Security will mean that there will be anything there for them to get back when they get to age 65.

The whole idea of Social Security is that you can't be trusted to save, so government's going to do it for you. Trouble is, it's even worse at it than we are.