Click here for a complete comparison of the payroll tax cut with President Obama's "Making Work Pay" tax credit.
We already know the proposed $120 billion payroll tax cut in President Obama's deal with the Republicans poses tremendous risks to Social Security. Now, our analysis reveals that it is altogether bad policy. The payroll tax cut would provide far more to Wall Street bankers and members of Congress than poor and middle class workers, who need the help more and are more likely to stimulate the economy with the money they receive.
State and local workers who are not covered by Social Security, including policemen and firefighters, would receive nothing from the plan. Americans seeking employment would also see nothing from the payroll tax cut. By contrast, renewing the "Making Work Pay" tax credit would provide real stimulus to our ailing economy without the handouts for the rich--and all at half the cost of the payroll tax cut.