The Wall Street Journal, Mar. 5, '99, Letter by James Baar
Amity Shlaes's "Greedy Hand" of government is even greedier than described in her excellent Feb. 25 editorial-page article. Ms. Shlaes points out that today's Social Security and Medicare tax of 7.65% of salary is the highest tax for seven out of 10 households. But that is literally only half the story. A second 7.65% of the taxpayer's earnings is taken by the Greedy Hand from the taxpayer's employer, thereby saving the employee the trouble of sending it along.
This sleight of hand, of course, is designed to obscure. But make no mistake. That second 7.65% belongs to the employee. It is legally regarded as part of total compensation. And its increasing size is a drag on any increase in wages and salaries. It is difficult under our present programs for most Americans merely to get their money back on the 7.65% that they know is removed from their pockets. Breaking even on 15.3% for most is a flim-flam promise that would make a three-card-monte artist blush.
Fortunately for our Governing Class and the Great Bureaucracy, this outrageous number - a tax of 15.3% on every working American - is little appreciated by the average taxpayer. Once fully understood, working Americans might have a chance to gain the option to put that 15.3% in a private bank account. Make that happen and we would have an economic renaissance that would make the present so-called "good times" look like a bad day in downtown Communist East Berlin.
|
NBC News, Mar. 6, '99, by Gwen Ifill
WASHINGTON - The Internal Revenue Service did a poor job of keeping its own financial books last year, congressional investigators reported Monday. The General Accounting Office told Congress that the problem-plagued IRS has misplaced billions of dollars in refunds, equipment and tax receipts.
Investigators also found that in the first nine months of 1998 alone, the government shelled out $17 million in fraudulent tax refunds. "The IRS cannot do some of the basic accounting and record keeping tasks that it expects American taxpayers to do," said Gregory Kurtz, who oversaw the audit for the GAO. All this, in spite of extensive IRS reform measures implemented last year.
"Think of this as not balancing your checkbook with the monthly bank statement, and at the same time having a system prone to error," Kurtz told the House Government Reform Committee's panel on government management.
The GAO said the IRS did a good job of collecting $1.8 trillion in tax revenue in fiscal 1998, and that the problems were found in the agency's administration of an $8.1 billion annual budget. The catalog of errors, according to government investigators, include the following:
- Taxpayers claimed $662 million in earned income tax credits. But $448 million of those claims - nearly 70 percent - were later declared invalid.
- During the last two years, investigators discovered 56 cases of employee theft totaling $1 million - and that's just one IRS field office.
- Of the $222 billion owed the IRS in uncollected taxes and fines, only $26 billion will ever be collected - 11 percent of what the government is owed. More than half of the outstanding debt will simply be written off.
- There was improper paperwork to keep track of items such as a Chevrolet Blazer, a $300,000 laser printer, laptop computers, televisions and fax machines. Most of these were accounting errors, not thefts.
- Poor computer security, including controls on access to sensitive taxpayer information, was cited.
- IRS officials on Monday were quick to take full responsibility for the problems, which they said were largely rooted in the agency's antiquated computer systems. They were clearly embarrassed by the report, coming as it does while the IRS attempts to become more efficient and more customer-friendly.
"I must sadly state that findings in this report have merit. And we have failed to meet our obligations," said IRS Chief Financial Officer Donna Cunnighame.
FRAUD SCHEME FOILED
The IRS says it can fix some of the problems, but that any measures will take time. The good news is that IRS officials disclosed that they have discovered a fraud scheme involving taxpayers claiming refunds for money paid into Social Security. This one, they stopped at a savings of nearly a billion dollars so far this tax filing season.
|
Unknown Author
Please sign this pledge and mail it to your Senators and Representatives in the United States Congress. Please distribute copies of this pledge in paper and e-mail format to all those who may also be interested in signing.
- WHEREAS the Social Security tax has always been a spend-as-you-go program rather than a true investment program, and,
- WHEREAS the Social Security tax is a Ponzi or pyramid type scheme in which the early recipients of the benefits received far more than they ever paid into the system, while the younger generations today will pay far more than they will ever receive, and,
- WHEREAS the number of people who receive benefits from Social Security relative to the number of people who pay the tax is expected to increase drastically within the next few decades, creating an unbearable strain on the economy, and,
- WHEREAS the Social Security tax was created more as a politically expedient way of pushing elderly workers out of the labor force during the Great Depression rather than because of any real need for charity, and,
- WHEREAS nearly every individual in the United States, including me, is capable of making his or her own plans for savings and retirement, and,
- WHEREAS any type of mandatory, regulated savings account would violate the freedom of the individual to decide how to spend his or her hard-earned money,
THEREFORE, I hereby solemnly swear to renounce any and all Social Security benefits for myself, refusing to partake of this ill-conceived transfer program, and,
FURTHERMORE, I call on the United States Congress to PHASE-OUT the Social Security tax by increasing the age at which benefits are paid by three months every year, into perpetuity, and to check increases in benefits of those who receive funds from Social Security.
|
![[socialsecurity.org]](G/Libertarian/socsec_banner.gif)
