“Removing a dedicated funding source for Social Security puts the future of the program in grave jeopardy,” B’nai B’rith International President Dennis W. Glick said. “Once the dedicated funding source is slashed, and people are used to lower taxes, they could easily blame Social Security for any changes. This could endanger future benefits and recreate the severe elderly poverty the system was created to address.”
The idea behind this payroll tax holiday is to stimulate the economy—people could use the extra money they bring home each paycheck to make big purchases.
The Social Security payroll tax may be a convenient way to provide this stimulus, but jump-starting the economy has nothing to do with Social Security and will create an unacceptable risk to an essential program.
As we learn over and over, Congressional “temporary” fixes have a way of becoming permanent. And the real possibility of losing forever part of this dedicated funding is not a risk we can afford Social Security to take.
Once the tax holiday year expires, long-time opponents of Social Security could cast the return to normal payroll tax rates as a major tax hike, instead of the restoration it truly would be. This in turn could lead to unnecessary resentment of a program that millions of older Americans rely on as their only source of income. Social Security could be portrayed as a deficit-buster that we have to tame, when in reality the program does not contribute to the deficit and has nothing more to do with this rate change than being a convenient vehicle for implementing a temporary stimulus.
“Social Security does not add to the deficit, period.” B’nai B’rith Director of Aging Policy Rachel Goldberg, Ph.D., said. “We have very real deficit problems and a stalled economic recovery to tackle, but tampering with this program is not the way to address them. We cannot afford to get used to this tax rebate, and we cannot afford to let the tax holiday threaten the future of Social Security.”
As a long-time advocate for senior citizens, B’nai B’rith International is carefully monitoring the various plans to decrease taxes and reduce the deficit.