Social Security and Medicare spending

[Igel]

19. It's merged for a sense of proportion, if nothing else.

And they're separate income taxes--that's all the tax that Congress has the authority to impose. It's just a specially-earmarked income tax with a different set of rules. But when you hear somebody say that we spend more on defense than X, it pays to have a handy chart that shows how much the federal government spends on X.

Since there are only income taxes and SS and Medicare are federal expenses, they belong on that chart and to leave them off helps confuse people. Calling some "income tax" and others "payroll" tax also obscures that they're both really taxes on income. One kind is fixed and flat with a cap; the other kind is fairly progressive with earned income credits, refundable and not, and a tangle of exemptions. The "payroll" taxes are on unadjusted gross income, as far as I'm aware (at least as far as I've personally run across as a taxpayer).

Also because when it comes to budget deficits, while they haven't been adding to the deficit (until they go in the red) they have been adding to the debt. Why? Because on paper their trust funds are assets held by the government that are simply paid out as their trust funds are liquidated--the asset is transferred on the books of the government from one agency to another agency, all neat and internally tidy. But since that liquidation is done without cash to pay for those reimbursements and following disbursements the only source of cash is debt--meaning that the government-internal debt becomes publicly held debt.