POLS 1101 Lecture Notes - Lecture 1: Majority Rule, Bicameralism, Presidential System
3 Sep 2016
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Social security: a. reprinted b. overview of the program: pay-as-you-go and prepaid plan, beneficiaries, progressive benefits (oasdi) paid for by payroll taxes (fica), a regressive tax, payroll taxes are regressive: poor pay higher percent than rich. ii. Must be used to buy government bonds. ii. These bonds appear in the books as income for the government. iii. They really represent a promise (an iou) that one part of government (congress) will repay another part (social security trustees) the loan plus interest. F. situation and trends under current law: by 2037 trust fund will be empty, social security will only be able to pay 70 percent or so of what it currently promises, allow individual, voluntary retirement accounts. i. Some of current payroll taxes would be diverted to individual retirement accounts. The fears: it will speed up date at which outlays exceed income. H. alternative proposals: divert money from general revenue into social security. i.
