Benefits Of Funding For Social Security

2037 WordsJun 17, 20169 Pages
Since the beginning of the 2007, Americans have worried about their individual finances, especially when it comes to future financial security. With the recent recession crippling most Americans ideas of retirement, a proposal has been presented with hopes of lessening the burden to senior citizens when it comes to retirement.1 The proposition that advances is increasing the Social Security Income Tax on households, asking for a raise from the current 6.2% to a future 7.2%. contends that this tax will enable funding for Social Security to remain unhindered for the next twenty years, which would give policy makers further time to make additional changes to the program. This paper will present a counter argument to the…show more content…
This tax, in theory, will have a minimal increase upon most of the working population, and guarantee that the Social Security program remains thriving for another twenty years. Again, the proposed tax increase is a whole percentage point change from 6.2% to 7.2%. However, those in favor of this project, and even, fail to recognize all of the economic and political ramifications that can and will arise from such a reformation. The first and foremost affected is the individual consumer. For the sake of continuity and this argument, it will be assumed that this consumer is also a laborer in the workforce. According to economic theory, the laborer spreads his or her time in the day between labor and leisure, all according to personal preference (citation needed). Within this theory, the trade off between labor and leisure comes as a downward sloping line that represents the hours devoted to each variable along the axis.5 Now if a higher tax rate was introduced, we can assume that income (the “y” variable) would decrease if working hours remained constant. This would result in a rotation downward for the trade-off line, meaning that the income would decrease. All this results in a
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