How many of you are dreading the breakout of political warfare over Christmas dinner? I am and I’m not even formally eligible to celebrate the holiday. I’ve seen no reliable count, but I sense that tens to hundreds of thousands of families have already come apart thanks to the Great Divider. More.
In its February 2018 report, Social Security’s Inspector General formally accused SSA staffers of reducing the benefits of thousands of widows — to the collective tune of $132 million. Here’s how the fraud, intentional or not, works. SSA forces, cajoles, suggests, or simply permits widows to unwittingly simultaneously file for both their survivor’s (widow’s) and retirement benefits. Doing so prevents widows from taking one of these two benefits early and the other later, after it has grown dramatically. MORE.
Do you have a mortgage on your house? And instead of paying off the mortgage are you investing money elsewhere? If so, then you are borrowing (from a mortgage company) at one rate and using the funds to invest at a lower rate – after adjustment for risk. Larry Kotlikoff says it makes more sense to pay off the mortgage – especially under the new tax law. More.
The amount you will save by paying off your mortgage rather than investing in securities amounts to more than one year’s income. If the alternative is to invest by means of a 401(k) – with the advantage of tax-free growth – it’s a closer call. But even here, many families will be better off if they pay down the mortgage. More.
Uncle Sam’s fiscal gap (promises minus expected revenues, looking indefinitely into the future) is now $239 trillion. That’s ten times the size of our Gross Domestic Product. Eliminating our current fiscal gap requires either a 50 percent immediate and permanent hike in all federal taxes or a 33 percent immediate and permanent cut in all federal outlays, apart from debt service. The longer we wait, the more painful the solution gets. More.
Elizabeth Warren economic advisers say the rich pay the lowest tax rates of all. Laurence Kotlikoff says they are wrong. Using the most sophisticated tools available to economists, Kotlikoff finds that among 40-year-olds, the top 1% face a lifetime average net tax rate of 34.5 percent. Yet when positive and negative taxes (benefits) are included, the poorest fifth are facing a rate of – 46.6 percent. For every dollar people in the bottom fifth earn, they get 46.6 cents back from the government. More.
Over the past 13 years, Mrs. Jimmy Rogers and her husband have, been deprived of tens of thousands of dollars in Social Security disability and spousal benefits, thanks to Social Security’s acknowledged mistakes. Jimmy has been forced to pay extra Social Security payroll taxes and extra federal income taxes she didn’t owe. And the government is still, to this day, sending them a bill for over $120,000 for disability and spousal benefits that they rightfully received. More.
Even climate deniers should be receptive to a carbon tax that is more than offset by reductions in other taxes. The total tax burden would be lower and we would be buying insurance against the bad effects of climate change. So argues Prof. Laurence Kotlikoff in The Hill. More.
The Federal Reserve is paying banks 2.35 percent on their reserves. Banks are paying depositors only 0.06 percent. Competition would eliminate that gap and sensible reform would eliminate the risk of another Great Recession, says economist Laurence Kotlikoff. He points to a “narrow banking” reform, which he first proposed with John Goodman in The New Republic ten years ago. More.
My Preferred Planning Software is MaxiFi I’ve been working on a research paper with UNC … Read More