The Daily Tax Report (subscription required), has good coverage in the wake of the Bush press conference. Since they've already got Senators Brownback and Allen against the indexing mechanism proposed by the President, it doesn't seem like it's got a lot of legislative legs right now. But, for what it's worth, the Democratic staff on the Ways and Means Committee put together an analysis.
A 28% reduction in benefits for people earning $37,000 a year is very serious.
Bush's proposal--once fully phased in--would result in a 28 percent benefit cut for a worker who had earned $37,000 per year. A worker who had earned $58,000 per year would have a steeper benefit cut of 42 percent. Meanwhile, a worker who had earned $90,000 per year would face a 49 percent benefit cut
Luckily, and this isn't unusual, Chris Dodd understands the big-picture choice that is being made.
Do I want to cut 50 percent of a middle-income person's retirement benefits, or do I want to ask the top 1 percent of income earners to do with a little less of a tax cut on a permanent basis? That choice is easy, and I think most of mySenator Dodd has more faith in the Senate than I do. They did, after all, just pass a budget that cuts taxes for the wealthiest Americans, cuts Medicaid and other key services, and increases the deficits over the next several years.
colleagues, Republicans and Democrats, would prefer that option