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Home Publications Blogs Beat the Press NYT Is Confused About the Payroll Tax Cut

NYT Is Confused About the Payroll Tax Cut

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Friday, 26 August 2011 04:41
The NYT told readers that the temporary cut in the payroll tax, "resulted in $67.2 billion of lost revenue for Social Security in 2011 and a total cost of $111.7 billion spread over 10 years." Actually, the cut did not cost the program anything since the lost tax revenue was replaced by general revenue.
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...
written by coberly, August 26, 2011 10:45
Dean

I think you got this one wrong. The payroll tax cut did result in lost revenue. The fact that the revenue was made up doesn't change the fact that 67 billion that the people would ordinarily, and painlessly, contribute to their retirement fund was not contributed to it, but Our President told them to take their retirement money and go out and spend it. Good advice from any financial planner.

As for "making it up from general revenue," this is a Trojan Horse. It makes it hard to say SS does not contribute to the deficit. Of course it's another lie, because SS does not contribute tot he deficit, the "payroll tax holiday" does.
The NYT is not alone
written by Bill H, August 26, 2011 11:24
Chris Matthews on Hardball has, several times, commented that the payroll tax cuts would reduce the cost of employment and make it easier for employers to hire. That would be (marginally) true if the cut came from the employer side of the payroll tax, but it comes from the employee side and does not affect employer cost at all.
I agree with Coberly
written by Carolyn Kay, August 26, 2011 12:56
Having watched over the last 20 years how skillfully the Republicans have suckered the Democrats, I'm convinced that this payroll tax holiday is nothing more than a way of getting support for cutting Social Security benefits.

Carolyn Kay
MakeThemAccountable.com

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.

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