In the March 31 edition of The New York Times, reporter Edmund L. Andrews greatly understated the amount of payroll taxes that President Bush's Social Security plan would allow workers to divert into private accounts. Andrews wrote that "workers would be allowed to divert up to 4 percent of their payroll taxes to personal retirement accounts." In fact, the plan would allow workers to divert up to 4 percentage points of their payroll taxes. This amount represents 64.5 percent of the employee contribution and about 16 times the amount that Andrews claimed. Employees and employers each pay payroll taxes equal to 6.2 percent of a worker's salary up to $90,000 to fund Social Security.
As Media Matters for America noted previously, this mistake is a common one.