Don Nickles: “I think my colleague raises an interesting point. What my colleagues have tried to do on the Democrat side is to…”

“I think my colleague raises an interesting point. What my colleagues have tried to do on the Democrat side is to institute a new Medicare benefit without financing it by Medicare. In other words, use general revenues to finance anything. I think if it is Medicare, it ought to be financed under the Medicare system. Maybe that is old fashioned. But if we are going to give it the Medicare designation, that is what it should be. A lot of people want to move a lot of different funds and have general revenues subsidize Medicare, but Medicare taxation is growing, and growing substantially. Let me give a couple of examples. Maximum taxation right now for a person who makes $76,000, paying Social Security and paying Medicare: Social Security tax equals $9,000; Medicare tax equals over $2,000. I remind my colleagues they have to pay for those taxes with aftertax dollars. They already have to pay income tax on those dollars to pay Social Security and Medicare tax. I am not sure everybody is aware of that. I think it is grossly unfair. Maybe one of these days we will be able to fix that. Right now, we haven't fixed it. So people can understand this dilemma, a person who makes $80,000 has to pay $9,000 Social Security tax, $2,000 in Medicare tax, and they have to do it with aftertax dollars. So to pay that $11,000, in reality they have to make about $14,000 or $15,000. That is the present system.”