February, 28 2023, 08:59am EDT
New Social Security Tax Cap Calculator
Today, February 28, is the first day this year that a millionaire stops contributing to Social Security. Most workers know that Social Security is financed through a tax on their earnings, but what many don't know is that the tax only applies to the first $160,200 of earnings per year. This means that while most Americans will pay 6.2 percent of their annual earnings into the fund, a millionaire’s effective tax is less than 1 percent — and far less for the country’s superrich.
Center for Economic and Policy Research’s (CEPR’s) Sarah Rawlins has created a calculatorator that allows users to enter any person’s annual earnings and see when they would stop paying into Social Security, the percentage of their earnings subject to the tax, effective tax rate, total amount of tax levied, and the amount of additional taxes that would be levied were the tax cap lifted.
To accompany the calculator, Rawlins wrote a brief explainer on the ways in which the current cap is part of the problem when it comes to the projected shortfalls of the fund. The cap places the burden on the vast majority of Americans while the nation’s highest earners evade their fair share. By “scrapping the cap,” Congress can make a significant stride toward saving Social Security.
The Center for Economic and Policy Research (CEPR) was established in 1999 to promote democratic debate on the most important economic and social issues that affect people's lives. In order for citizens to effectively exercise their voices in a democracy, they should be informed about the problems and choices that they face. CEPR is committed to presenting issues in an accurate and understandable manner, so that the public is better prepared to choose among the various policy options.
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Warren Bill Would Stop Companies From Placing Shareholder Paydays Over Worker Rights
"Following the most lucrative election in history for special interests," said the senator, "my bill will empower workers to hold corporations to responsible decisions that benefit more than just shareholders."
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Aiming to confront "a root cause of many of America's fundamental economic problems," U.S. Sen. Elizabeth Warren on Wednesday unveiled a bill to require corporations to balance growth with fair treatment of their employees and consumers.
The Massachusetts Democrat introduced the Accountable Capitalism Act, explaining that for much of U.S. history, corporations reinvested more than half of their profits back into their companies, working in the interest of employees, customers, business partners, and shareholders.
In the 1980s, said Warren corporations began placing the latter group above all, adopting "the belief that their only legitimate and legal purpose was 'maximizing shareholder value.'"
That view was further cemented in 1997 when the Business Roundtable, a lobbying group that represents chief executives across the country, declared that the "principal objective of a business enterprise is to generate economic returns to its owners."
Now, Warren said in a policy document, "around 93% of American-held corporate shares are owned by just 10% of our nation's richest households, while more than 40% of American households hold no shares at all."
"This means that corporate America's commitment to 'maximizing shareholder return' is a commitment to making the rich even richer, while leaving workers and families behind," said Warren in a statement.
The Accountable Capitalism Act would require:
- Corporations with more than $1 billion in annual revenue to obtain a federal charter as a "United States corporation," obligating executives to consider the interests of all stakeholders, not just investors;
- Corporate political spending to be approved by at least 75% of a company's shareholders and 75% of its board of directors; and
- At least 40% of a company's board of directors to be selected by employees.
The bill would also prohibit directors of U.S. corporations from selling company shares within five years of receiving them or within three years of a company stock buyback.
Warren noted that as companies have increasingly poured their profits into stock buybacks to benefit shareholders, worker productivity has steadily increased while real wages have gone up only slightly. The share of national income that goes to workers has also significantly dropped.
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The senator highlighted that big business interests invested heavily in November's U.S. presidential election.
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In a move likely fraught with major implications for worker rights during the impending second administration of Republican President-elect Donald Trump, Democratic-turned-Independent U.S. Sens. Joe Manchin and Kyrsten Sinema on Wednesday blocked Democrat Lauren McFerran's bid for a second term on the National Labor Relations Board.
With every Republican senator except Sen. Roger Marshall of Kansas voting against President Joe Biden's nomination of McFerran for a new five-year term, the fate of the woman who has led the agency since 2021 was up to Manchin and Sinema—who, as More Perfect Union founder and executive director Faiz Shakir put it on social media, "consistently spoiled the story of 'what could have been'" by years of fighting to thwart their own former party's agenda.
Sinema struck first, her "no" vote on McFerran grinding the confirmation tally to a 49-49 tie. Manchin, who showed up later, cast the decisive vote, negating speculation that Vice President Kamala Harris, the Senate president who lost the presidential contest to Trump last month, would break the stalemate.
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Chris Jackson, a former Democratic Lawrence County, Tennessee commissioner and longtime labor advocate, called Manchin and Sinema's votes "a crushing blow to the labor agenda."
"By casting decisive NO votes against President Biden's NLRB nominee, they've guaranteed Democrats will lose control of the national labor board until at least 2026," Jackson said. "Their votes effectively hand Donald Trump the keys to the board the moment he takes office again. This is a betrayal of working families—and a gift to corporate interests, which is par for the course for these two."
Sara Nelson, president of the Association of Flight Attendants-CWA union, said on social media that while "Manchin and Sinema are responsible for killing voting rights, worker rights, women's rights, LGBTQ rights, childcare, vision, and dental for seniors, and an economy built for the people," the two obstructionist senators "are not the story."
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Trump's first term saw relentless attacks on workers' rights. Critics fear a second Trump administration—whose officials and agenda are steeped in the anti-worker Project 2025—will roll back gains achieved under Biden and work to weaken the right to organize, water down workplace health and safety rules, and strip overtime pay, to name but a handful of GOP wish-list items.
The latest votes by Manchin and Sinema—who are both leaving Congress after this term—sparked widespread outrage among workers' rights defenders on social media, with one account on X, formerly known as Twitter, posting: "Manchin is geriatric and Sinema has a long fruitful career ahead of her in a consulting firm that advocates child slave labor, but at least they kicked the working class in the teeth one last time. Nothing to do now but hope there's a hell."
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Praise for Federal Trade Commission Chair Lina Khan continued to pour in on Wednesday after a pair of judges blocked the merger of grocery chains Kroger and Albertsons following challenges by the FTC and state attorneys general.
"The proposed Kroger-Albertsons merger would have led to higher prices at the grocery store and harmed workers," said U.S. Sen. Bernie Sanders. "Let me thank FTC Chair Lina Khan for successfully fighting this merger and standing up to corporate greed."
Congressman Mark Pocan (D-Wis.) also welcomed the rulings and sent "a big thank you to Lina Khan and her team at the FTC."
Their comments on Wednesday followed similar applause from Sen. Elizabeth Warren (D-Mass.) and Rep. Pramila Jayapal as well as groups including the American Economic Liberties Project (AELP) and Groundwork Collaborative.
Khan addressed the win during a Tuesday stream with political commentator Hasan Piker, noting that "this is the first time that the FTC has ever sought to block a merger not just because it's gonna be bad for consumers, but also because it's gonna be bad for workers."
Khan, an appointee of outgoing Democratic President Joe Biden, has won praise from progressives for taking on not only grocery giants and other companies trying to build monopolies but also Big Pharma and Big Tech.
Sanders recently called her "the best FTC chair in modern history" and AELP earlier this year published a document detailing how, under Khan's leadership, the agency "has entered a new era of more effective, modern, and democratic enforcement to better protect consumers, workers, and independent businesses."
Examples included in the AELP roundup include Khan's "crackdown on deceptive 'junk fees,'" a ban on noncompete clauses that's being challenged in court, a historic lawsuit against Amazon.com, and a "click-to-cancel" rule that requires sellers to "make it as easy for consumers to cancel their enrollment as it was to sign up."
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