IBD editorial quoted Will's false claim after Newsweek issued correction
SUMMARY: In criticizing Sen. Barack Obama for proposing to "lift[] the tax cap on earnings subject to the 12.4% Social Security tax, which now covers only the first $102,000," an Investor's Business Daily editorial quoted a false assertion made by George Will that a "Chicago police officer married to a Chicago public-school teacher, each with 20 years on the job, have a household income of $147,501, so you (Obama) would take another $5,642 from them." Newsweek issued a correction of Will's false claim the day before the IBD editorial appeared.
A May 20 Investor's Business Daily editorial claimed, "[Sen. Barack] Obama also said he'd consider raising payroll taxes. Indeed he would. Obama would save grandma and grandpa by bankrupting their grandchildren. He has proposed lifting the tax cap on earnings subject to the 12.4% Social Security tax, which now covers only the first $102,000," The editorial added: "As George Will points out, a 'Chicago police officer married to a Chicago public-school teacher, each with 20 years on the job, have a household income of $147,501, so you (Obama) would take another $5,642 from them.' " But Will's assertion -- in a May 2 Newsweek column, from which IBD quoted approvingly -- that the payroll tax is assessed by household is false; the Social Security tax is assessed on individuals, so raising the payroll tax income cap would have no effect on individuals whose income is below the current income cap.
Indeed, on May 19 -- the day before the IBD editorial appeared -- Newsweek issued a correction to the May 2 column, in which Will asserted: "You [Obama] favor eliminating the cap on earnings subject to the 12.4 percent Social Security tax, which now covers only the first $102,000. A Chicago police officer married to a Chicago public-school teacher, each with 20 years on the job, have a household income of $147,501, so you would take another $5,642 from them." Newsweek noted that "because the Social Security tax is assessed individually, and the couple each earns less than the current cap, any elimination of that cap will not have an effect on their tax burden."
According to his campaign website, Obama supports "increasing the maximum amount of earnings covered by Social Security" above the current level of "the first $102,000 a worker," but during the last Democratic debate, he said he would consider a "doughnut hole," exempting from a tax increase those making less than $200,000 or $250,000.
From the May 20 Investor's Business Daily editorial:
As for raising the retirement age, it's an option that's been considered by politicians of both parties, even by Barack Obama.
In a May 2007 interview with George Stephanopoulos on ABC's "This Week," Obama said he'd consider raising the retirement age himself. Obama also said he'd consider raising payroll taxes. Indeed he would. Obama would save grandma and grandpa by bankrupting their grandchildren. He has proposed lifting the tax cap on earnings subject to the 12.4% Social Security tax, which now covers only the first $102,000.
As George Will points out, a "Chicago police officer married to a Chicago public-school teacher, each with 20 years on the job, have a household income of $147,501, so you (Obama ) would take another $5,642 from them."
The editors of "Investor's Business Daily" should understand at least the basics of Social Security.
Apparently, they don't.
Kind of surprising that supposed experts on matters economic would be so grossly mistaken about such an elementary basic of how Social Security withholding works, isn't it?
It makes one start to think that perhaps this isn't so much a mistake as it is a BLATANT LIE.
"But George Will said it first" say the defenders of the reprehensible.
That does not excuse passing on the untruth, especially when it is your job to present truthful economic information. Repeating the lies or mistakes of another person when you have the knowledge to prove them wrong or untrue is intentionally passing on the false information. If the first person was merely mistaken and not deliberately lying, you have no such excuse. You are lying.
So, Rick, you're saying that Will is not necessarily wrong? There is a hypothetical situation where he could be accurate? WITH???
I know you're trying to be ridiculous, but I have to tell you that if you think that's an unbelievably absurd attempt at refuting an MMFA item, you're not reading enough of the wingnuts posts.
Kick it up a notch, pardner !
IBD has the same initials as Irritable Bowel Disease.
And about the same output.
Of course the IBD editors understand how it works. They're lying. Are you surprised? Republicans always lie. If they told the truth about their positions they wouldn't have any support.
As for George Will, he probably doesn't know how the tax system works. He's a pundit, and gets paid to repeat winger talking points. He doesn't need to know anything.
I'm thinking that they decided to go with the obvious misstatement of fact in order to cloak the more subtle one. The editorial claims that "Obama would save grandma and grandpa by bankrupting their grandchildren".
That's just not true. Social Security's chief actuary projects enough money to pay out all current and future benefits promised under the current system up until 2041. At that point, SS will either need to start borrowing funds to pay benefits or reduce benefit payments by 22%. See the 2008 Trustees report: http://www.ssa.gov/OACT/TRSUM/trsummary.html.
The grandparents on SS right now will be just fine either way. Thus what Obama is trying to do is fix Social Security for future recipients (current parents and grandkids) by adding an additional tax burden on high-earning young grandparents, parents and kids.