Candidates on Social Security

Here's a brief summary of the candidates' positions about Social Security in two (and a half) paragraphs. Maybe it's helpful for you.

John McCain hasn't yet made a full-bodied Social Security proposal during the presidential campaign. However, it seems that 1) he welcomes a bipartisan compromise to ensure a politically feasible reform, and 2) he would prefer giving younger workers the option of diverting some of their FICA tax to individual retirement accounts. This will give payroll taxpayers more freedom to choose how they want to fund their payroll tax-based retirement. However, it will also reduce the Social Security funding the 3.3 workers would normally provide for the one retiree. This will make it even more difficult to avoid Social Security bankruptcy (which is why many on the left believe McCain wants to kill Social Security).

Senator Barack Obama, on the other hand, opposes any privatization of Social Security. He believes, in contradiction to Senator Hillary Clinton, that Social Security is in crisis. His primary fix is to increase the payroll tax cap from $102,000. All workers contribute 6.2% and employers contribute 6.2% of payroll to Social Security, except those whose annual payroll exceeds $102,000. They pay nothing on their payroll over that cap, which means the highest income workers are taxed proportionately less than their lower income worker counterparts. Obama wants to tax more of the income of upper-middle-income and high-income workers, but presumably still at the 6.2% FICA tax rate every other worker pays. He also wants to establish automatic workplace pension plans for those workers working for employers who do not provide a pension plan, which is about half the workforce. "Under this plan, employers automatically enroll their employees in a direct deposit IRA account. Employees may opt-out by signing a written waiver. Even after enrollment, employees will retain the right to change their savings levels, reallocate investment portfolios or end contributions to the account." Employers will not finance the plan, would merely be a forwarding agent for employee contributions, and they would be eligible for tax credits to defray any cost to the employer. Of course, these contributions would be in addition to the standard FICA tax, not part of it.

From Evangelicals for Social Action, written by Bret Kincaid - whole article here