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By Owen Paine on Tuesday June 23, 2009 06:26 PM

Here's EPI elf John Irons. Recently he was reminding our federal senate that there is at least one cap Uncle oughta blow off, not put on -- and that one is now on our two-sided payroll tax. Irons wants to get rid of the cap on earnings taxable for Social Security.

I agree, of course -- though I hasten to add, in Paine's world we'd now be on payroll tax holiday till further notice.

But even in Paine's world, we'd enjoy scheduling a nasty 6% tax increase on all "upper earners" payroll, for the dark day when extraction recommences -- errr umh -- down the road somewhere, when we're flyin' through the endless main drag of hyperemployment city.

Some nice Irons tidbits:

"Due to growing income inequality, the share of earnings above the cap has risen from 10 percent in 1982 to over 16 percent in 2006. This is because incomes have grown strongly at the top while middle incomes have stagnated."
Note the sloppy misleading use of terms here -- "income" and "earnings" -- as if they were interchangeable. But hey. Let's not quibble.
"Including the employee and employer shares of Social Security and Medicare taxes, earners in the middle fifth of the income distribution pay an average effective payroll tax of about 11 percent.

In contrast, the top 1 percent of earners pay just 1.5 percent on average."

Question: should "newly-taxed earnings above the taxable maximum" also raise these folks' benefits?

Paine's world's Solomon-like answer -- hell no!

Comments (15)


A rollicking good idea, including Paine's world's provision. I'd go for progressive rates for every kind of tax -- sales, income, property, estate. Maybe not cap gains -- they have to make some money somewhere!

Mike Hunt:

Simon Pegg looks god in that pic.


The payroll
Tax as u know
Is twins now

To uncap the corporate dark side twin
Would raise the "cost" of over cap
By the current 6 plus rate

The .bright side
Twin could remain cap-ed why I don't know

Abstruse toy models
imply lower marginal taxes
Lead to more "output"

I like the notion actually
We see it in overtime premia
There to prohibit not reward of course
What with our viscious spontaneous job rationing system
Not a bad crude device

But in paine world
We'd be levied
On an individual soul's human capital just
Like on his/her house
On aseessed value
If sold for 2000 hours per annum

Marginal tax zero

I suspect this won't get read
Except maybe by hce

Too bad

My hu cap tax
With it's
oppressive productivist job fetish molloch socialism notions
So lovingly embodied
Would doubtless make for some nice pinko howls if it were

Where's the next van dingo


Typical lefty, pie-in-the-sky, utopianism, entirely compatible with unlimited growth traditional economics. My point is to stop growth, un-reward effort, encourage barter, scrounging, hunting and gathering, reading poetry.


Cultivated marginal rentiers
Can advocate anything

a craving for human flesh
Is not beyond the fringe for portfolio-ites

Son of Uncle Sam:

"income" and "earnings" -- as if they were interchangeable.
Is it like Booku to BoKu (the end of Richard Lewis's acidic lime light)

Al Schumann:

The Hu-Cap tax sounds infinitely horrible, but if you based it on successful passage through the credentialization sector and achievements in the affiliation-mongering sector, and used boastful CVs as its basis for upward adjustment, we might see a significant net decrease in gloating, cheese-moving managerial tricks, smirking, yuppie tantrums in Fair Trade coffee shops, self-inflicted Asperger's and other Hu-Cap negative externalities.


As usual super Al
Grasped the upshot of the head cap levy
And also per usual
Bangs it alond a stress fracture with a
Gem hammer


No one ever asks me
But the shaving mirror

But acting is okay
Class struggle wise
But I'd really like to tax


Is pure Gotha
To each according to his work
From each acoording to her ability


Why have just one


when you can have three

Al Schumann:

The Hu-Cap is pretty good. When I pore over the justifications for disproportionate reward structures, I'm deeply impressed by the degenerate vulgar marxism that's crept into the bootlicking industry. They really believe in the most juvenile conceptions of incentivization and human nature! I dislike negating their world view -- every servile asshole, and every parasite's parasite, is entitled to an opinion after all -- but I do want to help carry the logic through to its natural conclusion. To its deeply salutary conclusion.

Once the Hu-Cap tax has worked its magic, possibly for a few hundred years, or much less if its efficacy is left to Owen's thoughtful ministrations, the vulgar marxists of the bootlicking industry will be free to embrace gainful employment. Their patrons will have the chance, at long last, to get in touch with their more sensitive side. Fair Trade coffee shops will be scenes of peaceful debate, happy murmurs and light-hearted laughter. Cheese will continue to be moved, this time literally, by the former patrons as they work off their Hu-Cap debts.


"Cultivated marginal rentiers
Can advocate anything" (OP)

Hey, it was a joke!



"un-reward effort, encourage barter, scrounging, hunting and gathering,"

reward meager means ingenuity ???

a joke ???

i kinda liked your axiology

a j liebling series in NY
"getting by"


No, the joke was calling your HuCap musings "pie in the sky utopianism".

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