What about a way to avoid a cap raise for all but the truly wealthy:
"If Social Security is, as Conservatives tell us, heading for Armageddon, then why hasn’t Washington raised the FICA cap, currently at $106,800? Why, for instance, did Glenn Beck and Warren Buffett and Bill Gates and the Kardashians pay the same as I did in 2010? I maxed out in December; some of those folks hit their ceiling within the first few minutes of January.
Whether the great safety net actually will fray beyond repair by 2037—or whatever the current End of Days de jour—is open to debate. Many astute reasonable observers like The Washington Post’s Ezra Klein assure us that that Social Security is one of the most efficient federal programs, and that with a tweak or two it should be fine. Hardliners call for privatization, or a reduction in benefits, or a raised retirement age.
Privatization aside, some of those ideas were incorporated into the Simpson Bowles report. Specifically, the FICA cap would gradually increase to about $190,000 in 2020.
That goes too far—and not far enough. It still places a disproportionate burden on middle and lower income families. Why not a hybrid—cap it at current rates for those with incomes below, say $350,000, or $500,000 or even $1 million—then resume the contributions for all those above that. It’s something on the order of New York Sen. Charles Schumer‘s proposal for the Bush tax cuts—letting them expire only for true millionaires.
Either that or set an income cap for collecting Social Security. Without that $20,000 a year, or whatever it is, my 80-something in-laws would be on the street. But Glenn and Warren and Bill won’t need it; nor will Kim, Kourtney and Khloe—unless they blow all their hard-earned, famous-for-being-famous $$$."
Why Not Raise the FICA Cap