Why Do We Fund Social Security Differently From Other Government Programs?
Since its inception during the Great Depression, Social Security has been financed primarily by a dedicated tax on labor earnings. Today, workers and their employers together pay a 12.4 percent tax on the first $117,000 of labor earnings. This revenue – along with a relatively small amount of revenue from the income taxation of Social Security benefits – flows into the Social Security trust funds. From these same trust funds, benefits are paid to retired and disabled workers, their spouses, survivors and beneficiaries….Read More