Reagan is talking about “deficit” which is a point in time measurement. In 1984, we had raised payroll taxes to a point where it didn’t add to the deficit, provided that you ignore the EITC. So he isn’t being completely honest with the audience. They think he means overtime, and he let them reach the wrong conclusions.
In 2012, Social Security adds significantly to the deficit by dollar for dollar deficit spending subsidies. That is about to get a lot worse.
The people who would like to increase the payroll cap lay the lie clear : The fact is that every said penny could have been collected by the IRS for debt reduction. Social Security does not operate in a vacuum. When you pull in more resources it come from resources that aren’t available elsewhere. In this case you are simply diverting the tax base away from debt reduction to Social Security.
How can you say diverting taxes away from debt reduction to support Social Security doesn’t add to the deficit?
Rate this comment: 
0 
6
