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Originally posted by: DonDiegoQuote
Originally posted by: alanleroy
There was no equivalent of the 'Louisiana Purchase' investment made with the 13 Trillion of Debt our last two administrations racked up. Where did all the money go?
So, . . . like, . . . what should be cut ?
Thank you DonDiego. I'm glad you asked. Here are some of the proposed cuts and revenue sources from Simpson/Bowles. Much of this is still available for cutting..ie..nothing was ever done:
"The final plan was broken down into six major components (savings are 2012-2020):
1.$1,661 billion of discretionary spending cuts by putting in place discretionary spending caps into law lower than what is projected to be spent.
2.$995 billion in additional revenue with $785 billion in new revenues from tax reform by lowering income and corporate tax rates and broadening the base by eliminating tax expenditures. An additional $210 billion in revenue is also raised in other revenue by switching to the Chained-CPI and an increase in the federal gasoline tax
3.$341 billion in federal health care savings by reforming the Sustainable Growth Rate for Medicare, repeals the CLASS Act (which has already happened), increase Medicare cost sharing, reform health-care tort, change provider payments, increase drug rebates and establishes a long-term budget for total federal health-care spending after 2020 to GDP + 1 percent.
4.$215 billion in other mandatory savings by moving to the Chained CPI for all inflation-indexed programs, reform the military and civil service retirement system, reduce farm subsidies, reduce student loans and various other reforms.
5.$238 billion in Social Security reform, to be used to ensure the program is sustainably solvent in the infinite horizon by slowing benefit growth for high and medium-income workers, increase the early and normal retirement age to 68 by 2050 and 69 by 2075 by indexing it to longevity, index cost of living adjustments to the Chained-CPI, include newly hired state and local workers after 2020, increase the payroll tax cap to cover 90 percent of wages by 2050 and creates a new minimum and old-age benefit.
6.Budget Process Reforms by creating discretionary spending caps and caps total federal revenue at 20 percent of GDP.
An additional $673 billion is saved due to lower projected spending interest payments as a result from lower deficits."
The best part of Simpson/Bowles is it starts with a national consensus on what percent of GDP we will allow the Federal Government to consume. This allows government to grow at the same rate as the economy rather than consuming an ever increasing percent of our production.
Whenever a plan is opposed by both Paul Krugman and Grover Norquist, you know you're probably on to something good.
On the other hand, a Constitutional Amendment for a Balanced Budget would force a balanced budget without regard for where the tax increases or spending cuts come from. There are several alternative amendments that have been suggested over the years. Most are implemented over a period of many years and make exceptions for times of war and national emergency.
