Most of the discussion about the recent budget deal has been about Obama caving on failing to push for returning the top marginal income tax rate from 35% to 39%. It is certainly poltically symbolic to point at the screaming hypocrisy of Senate Republicans to threaten to hold up all legislation on this, but it really does not matter much one way or the other. This difference in rates barely affects income distribution, and we have had such top rates vary from 28% to over 90% during the last 70 years, with little obvious effect of either on economic growth.
However, one part of the deal that has mostly received praise, although a few such as Mark Thoma have noticed that it might have some negative consequences, is the "temporary" cut in payroll taxes. Now, I grant that this is more stimulating than keeping the lower marginal rate on top income earners, but it constitutes a hidden dagger in our political-economic-social system.
First, if we did not know it before, we certainly should now that there is no such thing as a "temporary" tax cut. Anyone attempting to allow such a temporary cut to expire politically becomes a "tax raiser," ready to be excoriated by millions of dollars worth of negative TV ads.
Second, this was obviously slipped in by the enemies of Social Security, who know the first point. So, we have long been hearing hypochondriacal howling out of the bipartisan crowd that wants to gut Social Security benefits to fix our budget problems, because, eeeek, it is going bankrupt soon!!! Well, with lowered revenues from its dedicated revenue source, well, you won't have to wait for it too long, these screamers will be back in force with much scarier projections. The bankruptcy will be coming sooner!!!!! Cut benefits more and even sooner !!!!!!! Eeeeeeek!!!!!!!!!