Why your paycheck is getting smaller, no matter what

CNN.com ^ | January 2, 2013 | Emily Jane Fox

[scott0347]

For middle class Americans, there will be no escaping higher taxes in 2013. Congress was able to pass legislation to keep broader middle class income taxes from rising. But workers will still have to pay at least 2% more in payroll taxes.

That's because the government had temporarily lowered the payroll tax rate in 2011 to 4.2% from 6.2%, in an effort to keep more cash in the pockets of Americans and provide a boost to the economy. The tax cut, which applies on the first $113,700 in annual earnings, expired on Monday.

[CMailBag]

IMHO This is one of the only “good” things in this plan.

It was insanity to reduce the revenue to a program that was already circling the drain and call it a “tax Cut”

[Wolfie]

Obviously. And yet never mentioned by the media. Go figure.

[Vigilanteman]

Technically, you are right. But the sooner the chickens come home to roost, the sooner the sheeple may awaken.

A closely watched consumer confidence index, which measures the American public's sentiments every month, sank six points. It was major turnaround from October, when the index reached a four-year high.

Anybody think the timing is a coincidence?

[campaignPete R-CT]

It was insanity to reduce the revenue to a program that was already circling the drain and call it a “tax Cut”

yes. If the American people want to cut the revenue to SS by 16%, they will have to cut the benefits by 16%. Which they clearly won't accept. So make 'em pay.

[Baynative]

Congress knows that when everyone else is shedding belongings, dipping into their savings to make ends meet and standing in line for buses or bread, they will still be drawing fat checks, great benefits and have the ability to give themselves another raise.

America proves [daily] that there will be no complaints.

[deoetdoctrinae]

I'll have the chili cheese fries,
with a side of cardiac arrest.

The FReepathon is on!
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[qman]

Regardless of what our pols do, our taxes go up every month by 85 billion, when ben bernanke buys treasuries. Every dollar in your pocket has been devalued, everything costs more, this is a hidden tax amounting to 1 trillion dollars a year!

[MrB]

Yeah, that one baffled me as well.
Reducing the revenues to SS when it’s already going bankrupt in the near future?

Insanity? Stupidity? Premeditated malign intent?

[ArmstedFragg]

Again, CNN seems mystified about the reasons middle class tax rates were going to rise. Which is, of course, because a while back the Democrats opposed making the cuts permanent. These guys must live in a world of constant mystery, where stuff keeps happening with no causality, just a vague belief that if it's bad, it must be Bush's fault.

I await, most likely in vain, the day when they notice that those Bush “tax cuts for the rich” are the same tax cuts they're now reporting benefit the middle class. I guess cognitive dissonance is bred out in J school these days.

[Terry Mross]

If you hear liberals complaining about their pay dropping by 2%, point out that obama could have cut the middle class taxes by an extra 2% to make up for it.

[Mr. Bird]

The problem is letting people think FICA taxes are dedicated to SS. SS and Medicare are the raison d’etre for the payroll tax, but the money just goes into the general fund.

The sooner people realize this, the sooner they will realize their REAL rate of taxation with no guarantee of returned benefit is around 30% (if they pay any income tax at all) and over 50% at higher incomes. And this is federal taxation only.

[who knows what evil?]

Smaller paychecks...woo-hoo!

[Moleman]

This tax revison should have been made permanent as well!!!!!

[KoRn]

That WASN’T a “tax cut”.

They were just taking away from Socialist Security, causing it to become insolvent much sooner.

[Aurorales]

I just got hit. FICA. Plus my wonderful CA taxes.

Gotta love that I am now missing about $160 more every month. (From what I can figure out on our pay statements.... I might be wrong and it is more...) Of course this is on top of my “through the roof” taxes the fine government already takes.

Robbery, pure and simple.

[Aurorales]

I was wrong... hubby just said it is more. The economy is going to do just swell. That is money out of my pocket I won’t be buying stuff with.

The government is soooooooooo smart.

[USAF80]

Government workers just got a lighter wallet too. OB supporters are in shock today. That Tax The Rich scheme didn’t work as planned. All us working suckers are the “evil rich”.

[MrB]

The only thing I can figure out as to why he’d cut the FICA tax was that it wouldn’t benefit “the rich” more than everyone else.

But, another side of me suspects that bankrupting SS sooner WAS one of the goals.

[Hoodat]

>Regardless of what our pols do, our taxes go up every month by 85 billion, when ben bernanke buys treasuries. Every dollar in your pocket has been devalued, everything costs more, this is a hidden tax amounting to 1 trillion dollars a year!

You are absolutely positively correct! And this is the part that disgusts me. We see our 'Republican' [sic] members of Congress posturing in opposition to raising the top rate by four percentage points while they sit idly by and give their votes of approval to increasing the debt ceiling (i.e printing up more money) to the tune of $2.5 trillion over the last 17 months alone. I can only buy two-thirds of the groceries I could buy with the same amount of money four years ago. yet I go to the store and see people fill up their carts and pay with EBT cards which were funded by that new money. So that one-third of groceries that I no longer receive have essentially been stolen from me by our government and given to someone else in order to buy votes and elections, and our Republican House hasn't done jack to stop it.