October 10, 2010

Popular Contradiction : Taxes must go up & Social Security is doomed

It seems that there are two prevailing opinions that are pretty common among many people.   These two opinions are :

1. Taxes must go up in the future given the current low tax rates and large deficit.
2. Social security is doomed and you shouldn't expect to get a dime out of it.

There are many people out there who would quickly and enthusiastically agree to both of these statements.  

In order for tax rates to go up our politicians will have to approve tax increases.   For #1 to be true the congress must approve increased taxes.   For social security to fail entirely the social security administration will have to run out of all money.    Social security can easily be fixed with increased tax rates, so for social security to fail outright our politicians can't raise the tax rate.  For #2 to be true congress must not approve increased taxes.

To believe #1 is to assume politicians will increase taxes.   To believe #2 is to assume politicians will not increase taxes.

To believe both of the statements is a contradiction.    Either politicians will/can raise taxes or they can't/ won't. raise taxes.

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