Payroll Taxes Case Study

1. How do payroll taxes levied on the earnings of workers affect their decision about how much leisure they consume? Americans during our time are living much longer and the payroll taxes levied on the earnings of the workers are not going to be enough to pay for those who are retiring. The affects of the decision about how much leisure they may consume will depend on if the real wages keep pace with the benefits offered in retirement. The fossils of today are very expensive and are now consuming over one third of the federal government’s budget. It is in their rational self interest to have the government find other ways to support these programs.
2. When the government taxes younger people to pay benefits to older people, how does this