The Chairman’s Report January 13, 2023

  • by:
  • Source: FAIRtax
  • 01/12/2023

WANT TO SAVE SOCIAL SECURITY—PASS THE FAIRTAX!


The Social Security Act was signed into law by President Franklin Roosevelt in 1935.  The idea was that the Social Security benefits are paid from the contributions of current workers.  In 1940 there were 159.4 workers for each Social Security recipient.  Now there are less than 2.8 workers for each recipient and this number is expected to decrease to 2 workers for each recipient over the next ten years.

This money is supposed to be paid into a “trust” fund and any excess above what is needed to pay benefits is borrowed by the Treasury in exchange for an IOU from the government.

It is also important to understand that in 1960, the U.S. Supreme Court ruled in Flemming v. Nestor, 363 U.S. 603 that there is no binding obligation to provide people benefits even if a person paid into the system for a number of years.  The court made clear that Congress can amend and revise the schedule of benefits and who is entitled to receive them.

Social Security has become an important source of income for retirees and people approaching retirement.  The Social Security Administration published these facts:
 
  • 69.8 million people received benefits from programs administered by the Social Security Administration (SSA) in 2020.
  • 5.8 million people were newly awarded Social Security benefits in 2020.
  • 55%of adult Social Security beneficiaries in 2020 were women.
A 2017 study by the Social Security Administration found that 19.7% of Americans 65 and over received at least 90% of their total income from Social Security.  Other studies from the National Institute for Retirement Security believe the number is much higher.

As people approach retirement, many are counting on their Social Security for most if not all of their retirement income.  Even those with other sources of income count on Social Security to provide a needed supplement to ensure they will have enough income to be comfortable in their retirement.

For many, a reduction in their Social Security payments will result in having to ask their children for financial aid or even force them to move in with their children. 
 
An analysis of the recent Congressional Budget Office (CBO) study on the growing insolvency of Social Security was published by Rachel Greszler, a research fellow in economics, budget, and entitlements in the Grover M. Hermann Center for the Federal Budget, of the Institute for Economic Freedom, at The Heritage Foundation.
 
Here are some of her observations:
 
  • Current law requires that Social Security benefits come from within the program, so once the trust fund runs dry, Social Security will only be able to pay as much in benefits as it receives from current workers. 
  • That will mean that in 2033,  the typical retiree will have an approximate $5,000 cut in annual benefits and the average disability recipient will have their benefits reduced by about $4,000. 
  • The only way to avoid these cuts is to immediately increase the Social Security tax on current workers from the current 12.4% to 17.2%.
  • This would mean an increase from the current employee payment of $4,402 to $6,106  in Social Security taxes for a household earning the median income of $71,000. 
  • Anyone who is 56 or younger today will not reach Social Security’s normal retirement age of 67 before the program runs out of money. And anyone who is currently between the ages of 57 and 107 today who is still alive and collecting benefits in 2033 will also be subject to benefit cuts.
  • If policymakers fail to act and benefit cuts begin in 2033, the CBO estimates that people born in the 1960s will experience a 19 percent reduction in their lifetime benefits, those born in the 1970s will experience a 26 percent reduction, and those born in the 1980s and 1990s will experience a 27 percent reduction. 
  • Research from The Heritage Foundation shows that the average younger worker could have three times as much retirement income if they had been able to own and invest their Social Security taxes—and even the lowest-income workers could have 40 percent more. 


THE FAIRTAX SOLUTION


It is simple.  Instead of taxing a decreasing number of workers to fund the promised benefits to Social Security recipients, the FAIRtax extends the tax base for Social Security to everyone whose spending rises above the poverty level.  This includes many wealthy individuals who pay little to nothing under the current system because they make their money from investments and capital gains, not from working for a paycheck.

Changing the funding source for Social Security from a payroll tax to the FAIRtax would ensure the future solvency of the program, while the prebate would ensure that no one pays taxes on their basic necessities.

With the FAIRtax, it will be simple to see the percentage of the FAIRtax needed to pay Social Security benefits and where cuts can be made in other spending areas to finance these benefits—without having to increase the national debt every year.
 

CONCLUSION


We all know that many in D.C. and in Congress privately see the Social Security crisis as an opportunity to exert more control over us and to move forward their agenda.

These people arrogantly believe that only they know what is best for us.  They also know that current law demands that Social Security payments must be made out of the Social Security trust fund.  When that fund runs dry, then the amount of money available to pay benefits will be limited to just what is being collected from current workers.

Of course, they could always change the law, but they see this as a great opportunity to raise the payroll tax, especially on people earning higher incomes.  They could also make drastic changes to who qualifies for benefits and how much they receive.  For example, they could decide that people who have other sources of income or whose assets exceed a certain level will receive greatly reduced benefits, or even no benefits at all. 

It's entirely possible that people who were forced to pay into the system for decades could end up getting little or nothing back.  While we can’t predict exactly what changes will be made, we know one thing for certain.  No matter what they come up with, the DC elites will most certainly smile at us and say, “That’s fair, isn’t it?”

There’s a much fairer, much simpler and much more efficient way to do it—THE FAIRTAX!

The FAIRtax doesn’t pick winners and losers.  Because it taxes spending, not earnings, the FAIRtax lets everyone save for their retirement tax free.  

The FAIRtax collects the revenue that the federal government needs to operate but does it in a way that has the least impact on our individual freedom and the least impact on our economic prosperity.  

There are no tax returns to file and no records to keep.  We pay our federal taxes when we make retail purchases of new goods and services, and there is no need for the IRS.  If you sell a used couch or used jet ski online, there is no FAIRtax due on that transaction.

The FAIRtax will allow us to TAKE BACK CONTROL.

The income/payroll tax system is broken and no longer working—we can’t repair it but we can replace it with the FAIRTAX!
 
Join us and TAKE BACK CONTROL OF OUR COUNTRY AND OUR LIVES—NOT WITH BULLETS BUT WITH THE ELIMINATION OF ONE OF THE BIGGEST THREATS TO OUR LIBERTY AND ECONOMIC PROSPERITY—THE INCOME/PAYROLL TAX.
 
We all should remember Edmund Burke’s warning that applies to our efforts to TAKE BACK CONTROL,
 
“Nobody made a greater mistake than he who did nothing because he could do only a little.”
 
We should also remember this quote from George Orwell's 1984, which, if we do nothing, may foretell your and your children's future:
 
“If you want a picture of the future, imagine a boot stamping on a human face—forever.”
 
WHAT CAN EACH OF US DO? 
 
We can write letters and make calls to our elected representatives and attend Zoom town hall meetings demanding that if they really want to allow Americans to “TAKE BACK CONTROL”, the first step is to eliminate the income/payroll tax system and enact the FAIRTAX!
 
TAKE BACK CONTROL!   Help us PASS THE FAIRTAX!
 
The IRS will be gone and we will pay our taxes when we make purchases.  
 
WE and not the Ruling Class and their minions in D.C. will decide how much federal tax we pay!
 
WE will know how much tax we and everyone else are really paying because taxes will no longer be hidden from us.  It will be clearly shown on every retail receipt.
 
If you have friends who don’t know about the FAIRtax, send them to  FAIRtax.org.  Have them watch the white boards under “How It Works” and, if they agree, ask them to please join us.
 
Then contact your Members of Congress and the President and demand that Congress pass -the FAIRtax—the only fair tax.
 
Is it hopeless?  When confronted with a seemingly impossible problem, remember the statement attributed to the author George Bernard Shaw who wrote, You see things; and you say “Why?”  But I dream things that never were; and I say “Why not?”
 
Isn’t it time for us to ask, “Why not?”  
 
HELP BRING ABOUT REAL TAX REFORM AND STOP FUTURE IRS ABUSES

By contributing (investing) $10.40 per month, you help provide a financial base to AFFT.  If you can make larger contributions (investments), these will be used not for salaries, as we are all volunteers, but for the needed updates to our economic studies which will be vital for all future years.
 
Please go to this link to invest in AFFT and in your and your family’s future.

 

Help FAIRtax Become The Number One Issue in 2022

Enacting the FAIRtax must be a prominent topic in these times. We did it before, we can do it again, but we need your help!

Help out with a One-Time Contribution

Your gift of $25, $50, $100 – even $1,000 or more if you can possibly spare it – will help FAIRtax.org bring an end to the IRS and promote a FAIRtax. So, I urge you, please give as generously as you can.

Billing information (REQUIRED)

Payment information (REQUIRED)

To donate by check:
Americans for Fair Taxation
PO Box 4929
Clearwater, FL 33758

If you need to make changes to your existing Monthly Re-Occurring Donation with new card or billing address information, then Please call Adam Yomtov our New York State Co-Director. He is assisting with the administration of our donations, technology services, and website.

Please note: Inputting your new information at our website won't update your donation. The only way to update is by calling Adam Yomtov 917-689-3931 mobile.


Americans for Fair Taxation® is a 501(c)(4) non-profit, non-partisan grassroots organization solely dedicated to replacing the current income tax system with a fair, simple and transparent national consumption tax – the FAIRtax® Plan. We rely entirely on contributions from concerned citizens like you who want a tax system that will generate jobs and stimulate the economy. Welcome to the FAIRtax team!

Connect

Share