Social Security and Medicare

I propose to solve the long term Social Security and Medicare funding shortfall by raising the wage cap for contributions from $94,000 to $200,000.  This will provide an additional $115 Billion per year.

Additionally, I propose that pension benefits be phased out for recipients who have more than $100,000 in other income in a given year.  Benefits would be proportionately reduced as other income goes to $200,000.  For example, if other income is $150,000, 50 % of benefits would be received ($175,000 - 25%, $200,000 -0%). 

Currently Social Security pensions are cut if the recipient has other earned income above $11,000 and has not reached his or her fully qualified age (65 - 66 years).  If he or she has a job and earns more than $11,000 the Social Security pension is cut one dollar for every two earned.  For the rich guy who gets a $million in stock dividends or capital gains, there is no penalty.  There are other  provisions in the tax laws under which tax earned income more severely than than dividends and interest.  And, of course, there is the issue of capital gains where the Republicans have lowered the maximum tax rate for long term (> 1 year) to 15 %. They are pushing to eliminate the tax on capital gains completely.  Now, isn't  that very Republican of them?!

Social Security and Medicare Funds must be kept separate from general funds to insure that they will be there when needed.

This proposal is included within the National Economic Policy topic.