Today's Los Angeles Times highlights the most important problem facing the United States, although it appears in two separate columns. The first column highlights the unemployment rate in California. Unemployment reached 20% in eight counties. Add in Florida, Georgia, North and South Carolina where unemployment is the highest since 1976 when the government started keeping records. Unemployment in the U.S. is extraordinarily high and persistent.
The other column points out that in 2009 there were 7.8 Million households with net worth in excess of $1 Million (excluding homes) up 16% since last year. Of that group, 980,000 households had net worths in excess of $5 Million, up 17%. Another 12.7 Million households had a net worth in excess of $500,000, up 12%. So clearly, the rich are simply getting richer.
So aproximately 20,000,000 households (different data source)paid no more than $6,621.60 in Social Security taxes. That is the amount any household with an income of $106,800 paid. Employers matched that amount, for a total contribution of about $13,000.
So let's do a little math. To make things simple, assume every household with incomes up to $1 Million paid about $117,000 more annually ($13,000 X 9). That alone contributes roughly $2.3 Trillion every year. If the cap were lifted completely, it would raise something in area of $3-4 Trillion!
End of Social Security scare! It also pays for healthcare for everybody!
Such a simple solution and not a single politician has enough guts to suggest it.
And I don't think we have to worry all that much about the richie riches. They are doing just fine.