Monday, December 16, 2002

STILL STUNNED. The Payroll Tax is not a tax. Here is the quote from the Washington Post article that still has me gap-jawed with disbelief.:


Answering critics who say the working poor do face high taxes because they pay high Social Security payroll taxes, outgoing White House economic adviser Lawrence B. Lindsey told the AEI tax forum that the 12.4 percent Social Security levy should not be considered when tax burdens are calculated. Lindsey said the Social Security tax is ultimately returned to the taxpayer as a benefit.

Lindsey compared the Social Security tax to a deposit in a neighborhood bank's Christmas Club. In such clubs, periodic deposits are returned in a lump sum during the holiday season, and Lindsey said no one would consider such deposits a tax.


Let me just note that, as someone who occasionally explains contemporary political theory to students, I understand the difference between professional understanding of words and their everyday understanding. When I use the word "liberal" or "republican" in my lectures, I always need to explain that "liberal" (i.e., John Locke) does not mean "liberal" (i.e. Barney Frank), and that "republican" (i.e., Ben Barber) does not mean "Republican" (i.e., Trent Lott). But I would never dream of insisting that Barney Frank isn't a liberal, because that would be really stupid. Language doesn't work that way.


Unless, of course, you're Lawrence Lindsey, for whom the payroll tax is not a "tax," but more akin to a "Christmas Club deposit."


Two things to note here:


1) Imagine an 87.6% income tax rate, and imagine that you're only paying payroll and the income tax. Your take-home pay would be zero. It would be cold comfort for someone to tell you, "well, you're not really taxed at 100%, since the payroll tax isn't really a tax." Give me a break.


2) Why a Christmas Club deposit? I think you can see the idea here: payroll taxes result in future benefits. The rest of the money we pay in taxes apparently disappears into a hole and doesn't provide any benefits whatsoever. The implications here are stunningly ridiculous, but they certainly serve an anti-tax agenda. Plus, the association of Social Security support with "Christmas" is really stupid. I'd like to see Mr. Lindsey write that on the checks my grandmother used to get: here's your Christmas Club check, Mrs. Wonson. How condescending.


Here's a hint to anyone who tries to appropriate Lindsey's line of thinking: you're a fool. Words don't mean whatever you want them to mean. Attempts to advance an ideological program under cover of the redefinition of words are creepy. (We need a new phrase for this. How about, GOPspeak?) And, you need to get out more.