I wrote my initial post in such a hot rage over the proposal to cut Social Security and Medicare benefits that I didn't take the time to edit my blog post (sorry about those strange sentence structures), or take the time to look at the details of the proposal. So now that I have calmly taken some time to do that, I have to admit that I was wrong: this thing is even worse than I originally thought, and I way understated the problems with it. The co-chairs and staff found every conceivable way to screw the middle class in ways big (very big) and small, but barely nicked the bankers who caused the meltdown of the economy, or the wealthy whose massive tax cuts ended the big budget surpluses as far as the eye could see coming out of the Clinton years. Look at some of the different ways middle class and poor people will be gauged by this proposal (and I am probably missing some):
Bowles and Simpson claim that they are being progressive by raising the Capital Gains Tax, but they make up for that by cutting corporate taxes and flattening the tax rates, so there is actually less progressivity in the tax code. They do claim some savings in defense spending and contracting, but a bare fraction of what could be saved if you got serious at all about reforming government contracting. And what they don't do is stunning: they don't go back to the Clinton era's tax rates on the wealthy that actually helped balance the budget. They don't impose a financial transactions tax on the speculative trading that did so much to crash this economy. They do nothing to create the jobs of the future that would actually spur the economic growth of the 1990s that were key in creating the budget surpluses of that era.
You know what is most bizarre: all this pain for the economically stressed working and middle class, and they still don't actually balance the budget until 2037. This is one of the worst policy documents I have ever seen -- and I lived through the George W. Bush era! The president that Erskine Bowles, Bruce Reed, and I worked for dug our way out of the big budget deficits of the Reagan/GHW Bush era and created a balanced budget and long term surpluses by doing modest budget cuts, taxes on the wealthy, and strong economic growth. Clinton did it without gouging the middle class in all the terrible ways listed above. We have a bigger hole to dig out of now because of the economic crisis of the George W. Bush era, but we can create a long term balanced budget with the same kind of formula, plus adding a financial transactions tax that would help curb dangerous financial speculation. There is absolutely no call for punishing the very people who have taken all the pain of the economic policies of the last decade. My old friends Erskine and Bruce should know better.
Another old friend of mine, Jon Cowan, writes today in Politico that this proposal is "the only game in town" for reducing the deficit. Not to put too fine a point on it, but what a crock. All we have to do is revisit the policies of the 1990s, minus the financial deregulation. The middle class has been burdened enough to pay for the excesses of Wall St and government contractors. Let's reduce the deficit the right way: by finally asking the people who caused it -- the wealthy who got huge tax cuts, the big banks who caused the economic collapse, and the government contractors who rip off taxpayers -- to make things right.
How can only one man do so much damage in only 2 years?
The giveaway is the wholly arbitrary cap on government revenue at 21 percent of GDP. As Kevin Drum pointed out, this is not a deficit reduction plan and no one should call it by that name. This is a smaller government plan.
We pay those who work for companies who don't pay them enough to live on.
But it did help those who were not paid enough by their employers, so I don't think we should give it up unless the corporations agree to pay a livable wage.
That is how they will make up the extension of tax cuts to the rich. It's projected that Americans will save $104 billion on their tax bills in 2011. When disallowed, that will mean over one trillion dollars over the next ten years will go into the government's coffers, whereas if tax cuts on the wealthy were allowed to expire, the government would realize $700 billion over the next ten years.
So again, on the back of the already beleaguered middle class, who are the lion's share of mortgage holders, the government will extract its much-needed tax revenue.
For once, I'm loving lobbyists if it means real estate lobbyists will be breathing down the necks of our Congressmen to make sure this idea is quashed before it ever sees the light of day.
Whereas this president, (my candidate and president) seems to look for ways to sell out the very people who worked to get him elected.
There was NO reason for him to even put together this commission. The rethugs blocked putting together a committee because they didn't want to actual come up with something that would get rid of the deficit and end the myth they are the party for the tax payer.
But Obama has just given them yet another report to bludgeon the middle class with.
He may have well just asked the CATO institute to right down the Rethugs ultimate plan.
have a nice day:}
Farm subsidies need to end tomorrow for major farm corporations or anyone who does not actively live on the land and work it himself (such as Sam Donaldson, sorry Sam, but you can afford this better than the truck farmer in Arkansas who made $72 profit last year).
Instead of the Small Business Administration ending, why not downsize the Commerce Department. What do they do except help get legislation passed that promotes big business instead of small business and working people? Or write anti-US trade treaties?
If we continue the Bush tax cuts for the wealthy, and we ever hope to shrink this deficit, the only way to do so would be to kill off just about every tax break and benefit for the poor, working class, and middle class (well, everyone making the median family income and below). Talk about class warfare. Its either going to be benefit the rich, or save just about everyone else in this country.
The Bush tax cuts which promote jobs? If they worked, why are we still in this recession? Its because that money never actually makes it back into the economy in any meaningful way.