Yesterday Fátima Báñez told congress that companies going to pay higher Social Security contributions with their earnings. But why? There is no reason to conflate deferred income, which the contributions are, with real corporate earnings. Except perhaps to avoid a thorny issue similar to the last time Social Security contributions were increased, incensing business owners.
It is also unclear whether increasing contributions would improve system revenues if their end goal is to get rid of the overall deficit. The only move that can improve the balance sheet besides reforming the entire system is to increase contributions. Paradoxically, the government's decision to increase labor costs for companies will have a negative effect on jobs.
