Payroll tax cut undermines Social Security's security

By Michael Hiltzik

The accepted response to the economic deal reached in Congress last week, extending the Social Security payroll tax holiday and unemployment insurance and maintaining reimbursement levels for Medicare doctors, is huzzah!

Finally Congress got something important done with a minimum of brinkmanship and posturing, and more than a few minutes before the deadline. A threat to the embryonic economic recovery was averted, and the extensions even pushed any subsequent fracas over the same issues to the end of this year, safely past the presidential election.


So why should we consider this action cause for despair?

It's because with every extension of the payroll tax holiday, which was first enacted in 2010, the prospect that Congress will ever restore the tax to its statutory 6.2% of covered income recedes a little bit further over the horizon. And that's bad medicine for Social Security.


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