23rd
Tax boost proposed by Obama
© Michelle Bollman
Published Summer 2008, Cincinnati Enquirer
COLUMBUS — Sen. Barack Obama promised senior citizens Friday that as president, he would protect Social Security benefits and provide universal health care.
To extend the life of the Social Security, Obama proposed applying a payroll tax to annual incomes above $250,000, affecting the wealthiest 3 percent of Americans. The Democrat also proposed eliminating income tax for any retiree making less than $50,000.
“Secure retirement is no longer a guarantee for the middle class,” Obama said during a visit to Oakleaf Village retirement center with his wife, Michelle. “It’s harder to save and harder to retire.”
Obama said it is unfair for middle-class earners to pay the Social Security tax “on every dime they make,” while millionaires and billionaires pay it on only “a very small percentage of their income.”
Meanwhile, Rob Portman, former White House budget director and former congressman from Terrace Park, questioned Obama’s Social Security proposal during a Friday conference call with reporters.
“Raising taxes in this weak economy, as Sen. Obama has proposed, is a very dangerous course,” the Republican said.
Obama accused the presumptive Republican Party nominee, Sen. John McCain of changing positions on whether to privatize the Social Security system.
McCain, campaigning Friday in New Jersey, accused Obama of misrepresenting his position.
“I will not privatize Social Security,” McCain said. “But I would like for younger workers, younger workers only, to have an opportunity to take a few of their tax dollars, a few of theirs, and maybe put it into an account with their name on it. That’s their money.”
Current retirees would not lose any benefits, McCain said.
The total Social Security tax rate of 12.4 percent is now evenly divided between workers and their employers. The workers’ 6.2 percent payroll tax is applied to all wages up to $102,000 a year, which covers the entire incomes of most Americans.
Under Obama’s plan, the tax would not apply to wages between that amount and $250,000.
But all salaries above $250,000-a-year amount would be taxed under his plan, Obama said.
Obama was vague about what forms of income would be affected, saying, “We should exempt anyone making under $250,000 from this increase so that the change doesn’t burden middle class Americans.”
Obama also criticized McCain for being open to letting taxpayers invest part of their Social Security payments in private investment accounts.
“Imagine if your security now was tied up with the Dow Jones,” he said prompting applause from a private audience of about 30 senior citizens. “You wouldn’t feel very confident about the security of your nest egg.”
Obama, speaking on other retirement issues, said he would limit circumstances as to when retirement benefits can be cut, and increase the wages and benefits workers could protect in bankruptcy court. Companies would have to disclose more about their pension fund investments, he said.
In other topics, Obama:
Said he would ask Congress to pass a universal health care plan by the end of his first year in office.
Said he wouldn’t redirect the $10 billion to $12 billion spent each month in Iraq on domestic programs. “We’re just taking out credit cards from the Bank of China,” he said of our nation’s rising debt. “If we end the war in Iraq in a honorable way, we will save money that we will be able to invest in the energy crisis.”
Pledged his commitment protecting homeland security, “Bin Laden is still hanging around,” Obama said of the terrorist behind Sept. 11, 2001 terrorist attacks that killed almost 3,000 Americans.
Gov. Ted Strickland, who previously stumped for Sen. Hillary Clinton for president, introduced the Obamas.
“This is the first of many, many visits that the two fo them will pay to Ohio,” he said. “I am so proud to be with them here today.”
