1. I am really puzzled about means testing for Social Security and Medicare. It’s clear to me that this would be a form of progressivity. If you showed a higher income on your return, either your contribution would be higher in percentage terms or what you could take out would be less than it would be if your income from other sources were less. What’s puzzling is that the positions of the Republicans and the Democrats on means testing seem to be just the opposite of their basic philosophies. The Republicans don’t want to raise taxes on the rich, but they seem to favor means testing. The Democrats, those infernal redistributionists, want to raise taxes on the rich, but seem opposed to means testing.
I do recall from college history classes that when Social Security was initially set up, it was seen as an insurance program and not as a safety net. Conditions in our society have changed so radically since the 1930s, that a whole new rationale for continuing the program may be appropriate. I did notice that my monthly payment to Medicare for Plan B went down after the crash dropped my income a little, so already there is an element of progressivity after retirement.
2. Why has it taken so long to get a clear statement from the President that the choice in the deficit reduction effort is between asking the rich to pay a little more or asking the poor and the middle class to bear the entire burden? He said it last night (July 25, 2011) and it needs to be said over and over again until everyone understands it.
3. And what is the deal with the Bush tax cuts? I read reams of stuff, and no one seems to mention them. As I understand it, if Congress doesn’t act to extend them, rates will go up for everyone beginning in 2013. It seems to me the Democrats have the upper hand here. If Obama is reelected, he can veto any effort to extend the cuts or make them permanent and then propose cuts for people making less than $250,000. If he loses, efforts to extend the cuts could be filibustered in the Senate, even if the Republicans manage to win a majority in 2012. Is there some language lurking in current proposals on the debt ceiling which would prevent this scenario?