Clinton Privately Weighs Social Security Tax Hike

Clinton is considering higher Social Security taxes on income above $200,000.


Oct. 12, 2007 — -- New York Sen. Hillary Clinton is coming under fire from Democratic rival John Edwards on the hot-button issue of Social Security taxes for the wealthy.

The indignation of the Edwards campaign was unleashed Thursday when a reporter for The Associated Press wrote that she had overheard Clinton, who has rejected the Edwards plan in public, privately tell a prospective voter she would consider a Social Security tax hike that resembles the approach favored by the former North Carolina senator.

"First Hillary Clinton says she opposes raising taxes to help make up the Social Security shortfall. Now she tells a voter privately that she would consider John Edwards' proposal for some additional taxes on workers making more than $200,000 a year," Edwards spokeswoman Andrea Purse told ABC News. "Voters deserve to know why she would consider one thing in private, but won't tell the American people where she stands in front of the TV cameras."

Reached by ABC News, the voter, Tod Bowman, a high school government teacher, confirmed the substance of the exchange. "Maybe I'm too harsh," Bowman told ABC News, "but it doesn't surprise me that any candidate would do a kind of flip-flopping, if I may use that term."

After a town hall meeting Sunday in Maquoketa, Iowa, Bowman says Clinton told him that she would consider applying the 12.4 percent Social Security tax to income above $200,000 while exempting income between $97,500 and $200,000.

Currently, all income above $97,500 is exempt from the Social Security tax. Half of the tax is paid by employers and half by employees.

Clinton's private comments to Bowman stand in contrast to a position she recently staked out during a Democratic debate sponsored by the AARP.

During that forum, which took place in Iowa, Sept. 20, Edwards voiced his support for imposing Social Security taxes on income above $200,000 per year.

When asked by PBS' Judy Woodruff, the debate moderator, whether she agreed with Edwards' proposal, the former first lady dodged the question, saying, "I want to focus on the fiscal responsibility piece of this," adding, "before we do anything else, we need to get back to what was working" in the 1990s.

At that point, Edwards interjected, hoping to get Clinton to directly answer whether she favored imposing the Social Security tax on income above $200,000 per year.

"So was that no? Was that no?" asked Edwards to which Clinton replied, "It's a no."

It turns out, however, that Clinton has not ruled out Edwards' plan for imposing higher taxes on those who make more than $200,000.

Perplexed by Clinton's Social Security stance at the AARP forum, Bowman asked Clinton during a Sunday town hall meeting what the harm is in raising, or eliminating, the Social Security tax cap.

Clinton did not directly answer the question. Instead, she spoke about the impact that President Bush has had on the budget deficit.

After the event, Clinton chatted with Bowman and said that she opposes completely eliminating the Social Security tax cap because she does not want to impose a new burden on those making between $97,500 and $200,000.

She added, Bowman says, that she would consider imposing the Social Security tax on those who make more than $200,000 per year — a concession that she has not been willing to make in public.

"I'm not putting anything on the proverbial table until we move toward fiscal responsibility," Clinton told NBC's Tim Russert during a Sept. 26 debate. "I think it's a mistake to do that."

While emphasizing that Clinton's focus remains on fiscal responsibility in the non-Social Security portion of the budget, the Clinton campaign is not challenging Bowman's claim that Clinton is considering a Social Security tax hike among serveral "worthy ideas."

Bowman has not yet decided which candidate he will support when Iowa holds the first-in-the-nation nominating contest in early January.

He says, however, that the candidate who might come closest to his views on Social Security may be Sen. Barack Obama.

The Illinois Democrat skipped the AARP forum, but he recently penned an op-ed in The Quad City Times, an Iowa newspaper, in which he floated the idea of completely eliminating the Social Security tax cap and imposing the 12.4 percent tax against everyone's entire income with no exemption for income between $97,500 and $200,000.

"For me," said Bowman, "it's about fairness."