Feb 07, 2011
Deficit commission co-chair Alan Simpson is back with a new installment of the colorful rhetoric for which he is known, featuring a “sparrow’s belch in the midst of a typhoon,” the cow that made so much trouble last year, and a few other images.
But the point being made by the former senator from Wyoming is quite serious: “I’m waiting for the politician to get up and say, there’s only one way to do this, you dig into the big four: Medicare, Medicaid, Social Security, and defense,” says Simpson. “And anybody giving you anything different than that, you want to walk out the door, stick your finger down your throat and give them the green weenie.”
There are a number of different approaches to Medicare, Medicaid, Social Security and defense spending; several choices are outlined in the report from the Committee on the Fiscal Future of the United States.
For more on Simpson, see “Fiscal Panel Co-Chair Blasts Critics As ‘Jerks’ “ by Jim Wolf at Reuters and this posting by Peter Schroeder of The Hill, in which Simpson talks about the move to introduce the commission’s plan as legislation and quotes a Democrat as being “ready to go out on this time by carrying the ball on this program.”
Steep Curves Ahead
In a New York Times op-ed, Jacob Lew, director of the White House Office of Management and Budget, sets the stage for the fiscal year 2012 budget proposal the Obama administration is about to send to Congress. “The Easy Cuts Are Behind Us,” says Lew, warning that we “cannot win the future, expand the economy and spur job creation if we are saddled with increasingly growing deficits.”
In addition to the five-year freeze on discretionary spending already announced by President Obama, says Lew, “we have had to look beyond the obvious and cut spending for purposes we support. We had to choose programs that, absent the fiscal situation, we would not cut.” Programs in this category targeted for substantial cuts include community block service grants, community development block grants, and the Great Lakes Restoration Initiative, which supports environmental cleanup and protection.
Rumblings From The Greek Chorus
In recent years, there’s been a lot of talk about crowdsourcing (public brainstorming on problems, often combined with online rating systems such as those used by the Obama transition team in 2008), and this is close to the spirit of Our Fiscal Future, where the views and choices of all Americans are important in charting a healthier fiscal path.
When it comes to what’s traditionally been known as the Greek chorus, the faces that come to mind are usually ordinary folks, intoning wisdoms and warnings the main characters of larger-than-life dramas would do well to heed.
But wisdom can also come from a bit higher up. Michael Sallas, chairman of Piraeus Bank, Greece’s fourth-largest lender, warns that the idea of lenders forming new and stronger groups will not be enough to cope with the effects of the Greek fiscal crisis: “With a sense of responsibility, we should stick to the policy of cutting spending and restoring budget revenues to create primary surpluses which will overbalance annual debt servicing needs,” said Sallas, in a Reuters interview.
Tax Reform: Asking The People What Should Be Done
The Wall Street Journal is inviting its readers to take up a subject that’s always hot at this time of year – even when we’re not trying to figure out how to slash the national debt. Here’s the topic: “Which is the best idea to get the rich to agree to shoulder more of the tax burden in America?”
Tax reform is however a little more complicated than a view of any one group of taxpayers. That’s a point that several economists have been emphasizing while discussing which direction the feds should head in any rewrites of either rates or deductions. Diane Lim Rogers, better known as Economist Mom, sums up that conversation in “It’s That Damned ‘Holey’ Tax System,” in which she challenges small government proponents to consider whether they’d give up their own tax deductions.
President Obama’s expected to talk about tax reform today, in a visit to the U.S. Chamber of Commerce, where business leaders are monitoring proposed revisions of the corporate tax code. A top concern in the business community: the net impact – that is, the degree to which a gain from any tax rate reductions might be wiped out by a vanishing deduction, exemption or allowance.
Uncle Sam meanwhile has bad news for many of us: IRS Not Ready To Process Many Returns Until Mid-February. That means late refund checks. The cause: miles of paperwork from last year’s income tax changes.
The Deficit and Presidents Reagan and Obama
As the nation marked the 100th anniversary of the birth of Ronald Reagan, and the media presented recollections from across the ideological spectrum, many commentators could not resist comparing Presidents Reagan and Obama and the fiscal situations they face.
Notable among these for their emphasis on deficit and debt (we’re nonpartisan here at Fiscal Future and are not taking a position on the Reagan legacy), are Stan Collender’s Is Ronald Reagan Really As Much Of A Model For Today’s GOP As It Wants Us To Believe? and Obama Channeling Reagan? Let’s Hope Not, by Michael Kinsley, in the L.A. Times.
Chart Of The Day
So, while we’re on the subject of tax reform, let’s take a look at the question of how much of the tax burden is shouldered by those who earn the most:
Click here to see a larger version of this chart.
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Fiscal Future Daily is produced by Public Agenda for Choosing Our Fiscal Future, in partnership with the National Academy of Public Administration and with support by the John D. and Catherine T. MacArthur Foundation. The editor in chief is Scott Bittle, with contributors Francie Grace, David White, Jen Vento, Hart Hooton and Tom Watson.