Saturday, November 13, 2010

The Bowles-Simpson Proposal

Maybe I haven't tried hard enough, but I can't seem to find a complete copy of the deficit reduction proposals of the co-chairs of the President's committee. There are some proposals here, some there, depending on who happens to be ranting, but the document itself is very hard to find.

Based on what I've read in various places, Bowles and Simpson have some ideas that are worthy of discussion. They recognize that a balanced budget is impossible without cuts to defense, Social Security, and Medicare. They recognize that taxes, overall, have to go up — no matter how many unlikely spending cuts are enacted. The responses from both liberals and conservatives were entirely predictable and, needless to say, entirely incompatible.

It's safe to say, though, that nothing much is going to emerge from this particular committee beyond the recommendations of the co-chairs. There is no way in hell that fourteen out of eighteen members will agree on a single program. Just the same, we can try to evaluate the proposals center-right Bowles and further-right Simpson propose.

Cutting tax rates and eliminating many deductions sound fair until one notices that the deductions proposed for elimination are those that most benefit the middle class. To my eyes, it looks mostly like a continuation of the transfer of wealth from the lower 99% to the top 1%.

Pers0nally, I've never thought the deduction for mortgage interest was fair to renters, but rather than drop the whole thing immediately I'd be more inclined to cap it, so that the major benefits are confined to mortgages on more modest homes. Eliminating it entirely right now would make the problems in the housing market even worse.

Predictably, I have no problem with cutting spending on so-called "defense," and would like to see even larger cuts, including the complete shutdown of the military base on Okinawa. Let Sarah Palin keep an eye on the North Koreans from her front porch. As I've argued before, I'm also in favor of lifting (actually, eliminating entirely) the cap on income subject to payroll taxes.

Gradually raising the age at which one could collect full Social Security benefits over the next sixty-five years doesn't even deserve a comment, but the justification offered for the proposal does — the idea of longer life expectancy. Look at the data and you will discover that it's not poor people living longer, it's rich people — people for whom Social Security payments are not nearly so important.

Finally, counting on the provisions of "Obamacare" to put a noticeable dent in Medicare spending is ridiculously optimistic. The only way to take a real bite out of health care expenditures is by adopting single payer.

Since Congress is not likely even to adopt even the Bowles-Simpson ideas — nor whatever the full commission finally agrees to, if it ever agrees at all — it's a dead cinch that my ideas are going nowhere.

No comments: