The White House is pressing for cuts to the Social Security and Medicare payroll tax — but it won’t help the people who need it most and would be a nightmare to administer
There are things that make great sense in theory but make no sense in the actual world in which we live. President Trump’s idea of eliminating (or modifying or who-knows-what-ing) the Social Security-Medicare payroll tax as part of an economic stimulus package is a classic example of something that makes no sense in the real world.
In theory, eliminating or reducing payroll taxes is the quickest and cleanest way to stimulate the economy for people who have jobs. Suddenly, those people are taking home more money than they were. That’s why payroll taxes have been cut before to stimulate the economy, and it seems to have worked.
But in our current environment, it makes no sense to cut or eliminate the payroll tax — paid equally by employees and employers — to provide emergency assistance to people in need and boost the economy, which needs all the stimulus it can get. Continue reading.