In response to our sputtering economy, President Barack Obama presented a new stimulus package last week, hopefully titled the American Jobs Act. More than half of the plan’s $447 billion cost comes from cuts to the payroll taxes, which fund Social Security and Medicare. This could increase the incentives to hire and work, and get money to poorer Americans. But to avoid making our perilous fiscal situation worse, those cuts should be paid for with future increases in the retirement age, and the plan’s proposed spending on infrastructure and unemployment insurance should be substantially reduced.
Glaeser, Edward L. "Payroll-Tax Cut Is the Working Part of Jobs Plan: Edward Glaeser." Bloomberg.com, September 12, 2011.