RUSH: Here’s Richard in Arlington, Texas. Richard, it’s great to have you on the EIB Network. Hello, sir.
CALLER: Thank you. Thank you, Rush.
RUSH: You bet.
CALLER: I’ve been listening to you for a couple of decades and I’ve enjoyed it.
RUSH: Thank you very much, sir. Appreciate that.
CALLER: This tax proposal that’s being considered, they were talking about a 2% pass on Social Security. That’s going to really have a negative effect on people who are, say, about 60 and above who are approaching the time when they are going to be looking at the Social Security benefits.
RUSH: Are you assuming that the 2% payroll tax cut for one year will result in less benefits to recipients?
CALLER: Yes, it will. Because when you go in to sign up for your benefits, they will look at your payments, payments that have been made on your behalf and it’s like an annuity.
RUSH: Is that right?
CALLER: The more you pay in, the more you get out.
RUSH: I did not think that they would be that petty.
CALLER: Oh, yeah. It’s in the rules. It used to be the more you paid in, the more you get. And it was the most that you paid over a, like an eight-quarter deal. Over, you know, the highest couple of years. And then recently, under these last couple of administrations, they —
RUSH: If you’re right —
CALLER: — make it over the last five years.
RUSH: If you’re right, this is a great point, though. This is going to save the federal government billions.
CALLER: (garbled) myself.
RUSH: Well, I mean, because they get to do a double whammy here. They get to reduce people’s taxes and then when those people retire, ‘Oh, guess what? You remember that tax cut you got 20 years ago? Well, your benefits are going to be reduced by 2%.’
CALLER: It’ll be $400 a year for a couple of decades.
CALLER: So you get $400 a year break this year and it’s going to cost you $10,000 over your retired years.
RUSH: That’s right. If you’re depending on them, that’s absolutely true. I’m going to look into this. We’ve got to find this out. I’m going to find this out because for one it’s fascinating. It’s interesting to me. If this 2% cut for one year will actually result in a reduced benefit payment for everybody who gets the cut.
CALLER: For everybody who gets a cut who qualifies, who goes in to put in for Social Security in the next five years.
CALLER: People who are 60 and 61 to 65, that kind of thing.
RUSH: Yeah, yeah.
CALLER: And so it’s those folks that have been paying into Social Security for 45 years thinking that, ‘Hey, I’m going to get a check.’ They used to send us a statement that said, ‘You’re going to get like $3,000 a month because you’ve been paying in a lot,’ and then they sent a note saying, ‘Weeeeeell, we’re going to pay a couple of thousand dollars a year because we’re only going to use the last couple of years.’
RUSH: Right. What’s your favorite football team, Richard? The Cowboys?
CALLER: (laughs) Used to be.
CALLER: I’m looking for one.
CALLER: Maybe that Tony guy could suggest somebody. You know what? I think maybe you could have him as a, as a guest host and then he could look behind the curtain and see what the powers of the leverage are.
RUSH: No, that wouldn’t tell him —
CALLER: Maybe he could speak a little, you know?
Rush: No. He might be a good host but that wouldn’t tell him what I couldn’t tell him. He wouldn’t learn that simply by being a host. He might learn other things but he wouldn’t learn that. Anyway, Richard, thanks for the call. I appreciate it.