Stark budget choices facing American voter in 2012

Once politicians and pundits start talking in terms of hundreds of billions and even trillions of dollars, eyes glaze over. Most Americans simply aren’t equipped with long government ledgers in their heads, and even when written down on paper, 12- and 13-digit numbers can be mind-boggling.

Stripped to their essence, however, the budgetary choices facing the country are not all that complicated.

Most Americans understand that our deficits are too high. So let’s assume, strictly for the sake of argument, that folks in Washington are able to reach a consensus on how much we need to reduce that deficit from current levels. Let’s assume that the Democrats and Republicans settle on a deficit-reduction target of $500 billion a year, a figure chosen here because it is a nice, round, easily comprehended number.

Now let’s add some real numbers to it.

On top of that $500 billion, Mitt Romney would increase defense spending to some 4 percent of GDP, which would add roughly $200 billion a year to the deficit. That would raise the total amount of offsets ($500 billion + $200 billion) that we need to find elsewhere to $700 billion. Romney would also insist on retaining tax cuts to the rich, including reductions in or even elimination of estate and gift taxes. As recently as the first debate, Romney has insisted that he would not accept increased revenue as part of any budget deal.

Given the mathematical realities of the budget, and with defense off the table, almost all of that $700 billion would have to come from programs that benefit the despised 47 percent, with no sacrifice whatsoever required of those Americans doing quite, quite well in this economy. Medicaid, which provides health insurance to poor children and long-term care for some 60 percent of elderly Americans in nursing homes, would be a prime target; millionaires and billionaires would be exempt.

So that’s one approach.

President Obama, on the other hand, proposes to ask the Pentagon to share in the belt-tightening, reducing defense spending by some $100 billion a year. He also proposes to ask more affluent Americans to share in the sacrifice to at least some degree, increasing revenue by some $80 billion a year. Under that second approach ($500 billion minus $100 billion minus $80 billion), we’d still have to find some $320 billion a year in annual non-defense savings. That would be a significant number, and the pain it would cause would be real.

However, $320 billion — and the pain that comes with it — would be considerably less than the $700 billion in spending cuts required under the Romney approach. In addition, rather than dump the burden entirely on those already struggling in the current economy, the sacrifices would be shared. Given the income inequalities that have manifested themselves in the last two decades, and that continue to grow, that hardly seems unfair.

Those are the two choices, laid out in stark, direct terms.

– Jay Bookman

250 comments Add your comment

Steve-USA

October 15th, 2012
6:49 am

What a mess were in.

Ol' Timer

October 15th, 2012
6:57 am

If I find myself in a financial squeeze, I will cut, cut and cut the budget some more; but at the same time will attempt to increase my income by trying to pick up some overtime or a part-time job.

The reality that the GOTP fail to acknowledge is that tax revenues, as a percentage of GDP, are at a 60 year low. We continue to cut the revenue stream with the Bush tax cuts at a time when we have massive unemployment.

Only in Washington will you find that kind of illogical and irrational action. And, only in Washington will you find those who sign a pledge never to address this vital issue.

And, so it goes, , , ,

“Against stupidity even the gods contend in vain.” ~ Friedrich Shiller

gdrla

October 15th, 2012
6:58 am

Seems simple to me but I guess our politicians are just to damn stupid or in hock to Grover Norquist to see and/or deal with it. Just like a household budget – CUT SPENDING & GET MORE $$ IN THE DOOR (REVENUE = TAXES!). Go back to the Clinton era tax rates & cut our spending to what is necessary n& essential.

The Republican mantra is to cut taxes & the economy will boom – then why since we have had mostly Republican presidents over the past 30 years is the economy in the mess it is currently in? And why, when a tax & spend liberal Democrat (Slick Willie) passed a rather large tax increase did the economy boom right along for several years until another ‘publican who cut taxes got into office. And NO, I did not vote for Obama – won’t this time either but his opposite number Romney is just as clueless. Further full disclosure – Yes, I am ENTITLED – now 62 & working since 14 – I am entitled to my SS & Medicare benefits!

weetamoe

October 15th, 2012
7:00 am

This is just a longer version of the fundy *the bible said it* bumper sticker. Two choices, given you by an employee of the AJC! The intellectual decline in this country is more rapid than predicted.

Jay

October 15th, 2012
7:02 am

Tell me where it’s wrong, weetamoe.

Demonstrate your superior intellectual prowess.

ByteMe - Thugs vs. Ilk... in 3D!

October 15th, 2012
7:05 am

There are over 200 personal tax deductions, totalling $1.1 trillion in revenue in 2013. The top 20 of those expenditures comprises 90% of that revenue total. Unless you want to really annoy everyone (or cause a whole mess of new foreclosures by increasing the cost of having a mortgage), the best you could probably get from eliminating the deductions is about $100 billion or so. Certainly not enough to close the deficit gap while still lowering rates.

Oh, that’s right, the problem is we’re supposed to assume that “growth” on a scale never seen before will solve this all on its own. Because trickle-down economics has worked so well at eliminating the deficit….

ByteMe - Thugs vs. Ilk... in 3D!

October 15th, 2012
7:06 am

Ol' Timer

October 15th, 2012
7:06 am

“I’m patient with stupidity but not with those who are proud of it.” ~ Edith Sitwell

Elias Denny

October 15th, 2012
7:09 am

As an older retired person with a total household income of $40,000 I would gladly pay more in federal taxes if the burden was shared by more affluent. In the end we always have to pay for what we recieve.

Jay

October 15th, 2012
7:09 am

Byteme, eliminating deductions isn’t intended to address the deficit in the first place. Romney is eying them solely as a means to finance his 20-percent rate cuts.

And as you point out, even then they will fall well short. No politically feasible combination of deductions can finance rate cuts of that magnitude, which means his tax plan will make the deficit worse, not better.

I consciously chose not to get into that issue in this piece, in the interest of simplicity. But those are the facts.

ByteMe - Thugs vs. Ilk... in 3D!

October 15th, 2012
7:13 am

Romney is eying them solely as a means to finance his 20-percent rate cuts.

Yep, that black magic “growth” pill he’s trying to get people to swallow is what’s supposed to cure the deficit.

But Obama’s plan won’t solve it either. It’ll get closer faster, but it won’t solve it.

My plan would be just to let all the cuts expire, suck it up for about 16 months while the change causes a business cycle recession (different from a credit crisis recession), and then we’re poised for real growth and serious deficit reduction from the additional incoming revenue. But politicians are too chicken to actually do this.

Jay

October 15th, 2012
7:15 am

yes, ByteMe, they are.

Thomas Heyward Jr

October 15th, 2012
7:16 am

I pick the Third choice.
.
Repudiate the debt.
.
I didn’t sign nothing.
I want nothing from Washington but for those crooks to leave me alone.
.
Forward Liberty.
Ron Paul 2012.

tm

October 15th, 2012
7:23 am

Amazing that you attribute no “pain” to the $80 billion tax increase. “Pain” is only attributed to cutting benefits or programs.

Jay

October 15th, 2012
7:28 am

tm, somehow, “pain” isn’t what comes to mind when asking the top 1 percent to contribute a little more. I don’t think that’s going to inflict pain on them in the same way that kicking a poor family off Medicaid inflicts pain.

It is undoubtedly a bit of a sacrifice, however, which is why I described it in those terms, as a “share in the sacrifice.”

Jm

October 15th, 2012
7:29 am

Given the size of the deficit, over a Trillion, $500 billion doesn’t get it close to being a reasonable level, though it would at least be taking things in the right direction.

http://www.usgovernmentspending.com/federal_deficit_chart.html

“with no sacrifice whatsoever required of those Americans doing quite, quite well”

You mean other than the fact that, because of the progressive tax system, that the wealthy already pay the vast majority of income taxes?

Well excluding that significant fact, I suppose you’re right.

Jm

October 15th, 2012
7:31 am

“So let’s assume, strictly for the sake of argument, that folks in Washington are able to reach a consensus on how much we need to reduce that deficit from current levels.”

That’s convenient. Because Obama doesn’t have any plan or intention to reduce the deficit.

Ken

October 15th, 2012
7:32 am

Should have cut spending years ago. But spending buys votes.

Jay

October 15th, 2012
7:33 am

” But spending buys votes.”

So do tax cuts.

Normal Free...Pro Human Rights Thug...And liking it!

October 15th, 2012
7:33 am

If this governmental budget crisis was morphed into your family budget crisis, would you cut your children’s allowance before you stopped your credit card spending? Just asking…

Doggone/GA

October 15th, 2012
7:36 am

“Should have cut spending years ago. But spending buys votes.”

Ok…so what spending would YOU cut and how much would it help towards reducing the debt and deficit. Numbers please, not just platitudes.

ByteMe - Thugs vs. Ilk... in 3D!

October 15th, 2012
7:38 am

If this governmental budget crisis was morphed into your family budget crisis, would you cut your children’s allowance before you stopped your credit card spending? Just asking…

Nah, I’d steal from the poor neighbors instead :)

stands for decibels

October 15th, 2012
7:40 am

President Obama, on the other hand, proposes to ask the Pentagon to share in the belt-tightening, reducing defense spending by some $100 billion a year. He also proposes to ask more affluent Americans to share in the sacrifice to at least some degree, increasing revenue by some $80 billion a year. Under that second approach ($500 billion minus $100 billion minus $80 billion), we’d still have to find some $320 billion a year in annual non-defense savings.

Or, we could acknowledge that the budget deficit issue is bullsh-t heaped upon us by our Galtian overlords, and elect a President willing to say that so long as we need to borrow money for next to nothing in interest we should do it until we’ve got something resembling full employment.

Since I don’t have that choice this year, I’ll continue to go with the side that won’t screw us anywhere near as badly as the Goopers.

(that’s just regarding fiscal matters. On virtually everything else, the GOP is a freaking disaster movie, and why any rational American would hand them the keys completely mystifies me.)

stands for decibels

October 15th, 2012
7:41 am

Should have cut spending years ago.

Why settle for 7.8 percent unemployment when you could have Depression level unemployment?

Cut baby cut!

Ken

October 15th, 2012
7:42 am

Doggone

* Corporation for Public Broadcasting Subsidy — $445 million annual savings.
* Save America ’s Treasures Program — $25 million annual savings.
* International Fund for Ireland — $17 million annual savings.
* Legal Services Corporation — $420 million annual savings.
* National Endowment for the Arts — $167.5 million annual savings.
* National Endowment for the Humanities — $167.5 million annual savings.s
* Hope VI Program — $250 million annual savings.
* Amtrak Subsidies — $1.565 billion annual savings.
* Eliminate duplicating education programs — H.R. 2274 (in last Congress), authored by Rep. McKeon, eliminates 68 at a savings of $1.3 billion annually.
* U.S. Trade Development Agency — $55 million annual savings.
* Woodrow Wilson Center Subsidy — $20 million annual savings.
* Cut in half funding for congressional printing and binding — $47 million annual savings.
* John C. Stennis Center Subsidy — $430,000 annual savings.
* Community Development Fund — $4.5 billion annual savings.
* Heritage Area Grants and Statutory Aid — $24 million annual savings.
* Cut Federal Travel Budget in Half — $7.5 billion annual savings
* Trim Federal Vehicle Budget by 20% — $600 million annual savings.
* Essential Air Service — $150 million annual savings.
* Technology Innovation Program — $70 million annual savings.
* Manufacturing Extension Partnership (MEP) Program — $125 million annual savings..
* Department of Energy Grants to States for Weatherization — $530 million annual savings.
* Beach Replenishment — $95 million annual savings.
* New Starts Transit — $2 billion annual savings.
· Exchange Programs for Alaska Natives, Native Hawaiians, and Their Historical Trading Partners in Massachusetts — $9 million annual savings
* Intercity and High Speed Rail Grants — $2.5 billion annual savings.
* Title X Family Planning — $318 million annual savings.
* Appalachian Regional Commission — $76 million annual savings.
* Economic Development Administration — $293 million annual savings.
* Programs under the National and Community Services Act — $1.15 billion annual savings.
* Applied Research at Department of Energy — $1.27 billion annual savings.
* Freedom CAR and Fuel Partnership — $200 million annual savings..
* Energy Star Program — $52 million annual savings.
*Economic Assistance to Egypt — $250 million annually.
* U.S.Agency for International Development — $1.39 billion annual savings.
* General Assistance to District of Columbia — $210 million annual savings.
* Subsidy for Washington Metropolitan Area Transit Authority — $150 million annual savings.
*Presidential Campaign Fund — $775 million savings over ten years.
* No funding for federal office space acquisition — $864 million annual savings.
* End prohibitions on competitive sourcing of government services.
* Repeal the Davis-Bacon Act — More than $1 billion annually.
* IRS Direct Deposit: Require the IRS to deposit fees for some services it offers (such as processing payment plans for taxpayers) to the Treasury, instead of allowing it to remain as part of its budget — $1.8 billion savings over ten years.
*Require collection of unpaid taxes by federal employees — $1 billion total savings.WHAT THE HELL IS THISABOUT?
* Prohibit taxpayer funded union activities by federal employees — $1.2 billion savings over ten years.
* Sell excess federal properties the government does not make use of — $15 billion total savings.
*Eliminate death gratuity for Members of Congress.WHAT???
* Eliminate Mohair Subsidies — $1 million annual savings.
*Eliminate taxpayer subsidies to the United Nations Intergovernmental Panel on Climate Change — $12.5 million annual savings WELL ISN’T THAT SPECIAL
* Eliminate Market Access Program — $200 million annual savings.
* USDA Sugar Program — $14 million annual savings.
* Subsidy to Organization for Economic Co-operation and Development (OECD) — $93 million annual savings.
* Eliminate the National Organic Certification Cost-Share Program — $56.2 million annual savings.
*Eliminate fund for Obamacare administrative costs– $900 million savings.
* Ready to Learn TV Program — $27 million savings..
* HUD Ph.D. Program.
* Deficit Reduction Check-Off Act.
*TOTAL SAVINGS: $2.5 Trillion over Ten Years

Granny Godzilla - Union Thugette

October 15th, 2012
7:44 am

Jm

You mean other than the fact that, because of the progressive tax system, that the wealthy already pay the vast majority of income taxes?

.
.
.
As they own the vast majority of the wealth in this country it sounds fair to me.

Significant to be sure.

Jay

October 15th, 2012
7:45 am

But spending buys votes.

Which is why Republicans created Medicare Part D without finding the money to fund it, and why, for the first time in our nation’s history, they cut taxes in wartime, wartime in this case meaning two major wars. In almost every previous case, our leaders understood that if a goal was worth spending American lives to achieve, it was worth raising tax money to achieve.

Jm

October 15th, 2012
7:46 am

I wonder where Obama will find the other $820 billion in revenue required to pay for his spending?

Oh right. He’ll either put it on the Chinese tab. Or he’ll have to tax the middle class more.

Romney won’t raise taxes on the middle and lower class.

There is a clear choice and the better choice is Romney, someone who has fiscal discipline.

Gravy Train

October 15th, 2012
7:47 am

Yes, the plutocrat lap dogs are going to echo the cries of their masters. Taxed enough already, they say. I’m sure the inconvenience of having to hold off on that new car elevator is equal to the decision many families are making these days between food and utilities, well, they say it is. Much like how riding around Paris selling magic underwear is the equivalent of sitting in a fox hole in Vietnam.

Granny Godzilla - Union Thugette

October 15th, 2012
7:49 am

“Romney won’t raise taxes on the middle and lower class.”

Which Romney?

1, 1.2, 2, 2.5, 2.55, 2.75, 3, 3.2?

Doggone/GA

October 15th, 2012
7:50 am

Ok, that’s a nice list…what does it add up to and how much will it reduce the debt and deficit?

stands for decibels

October 15th, 2012
7:52 am

You mean other than the fact that, because of the progressive tax system, that the wealthy already pay the vast majority of income taxes?

maybe if you repeat that non sequitor often enough, someone besides your own echo chamber will think it’s relevant to the discussion at hand.

DownInAlbany

October 15th, 2012
7:53 am

You do realize that if the “Bush” tax-cuts are allowed to expire, without additional action, even the lowest current rate (10%) doubles to 20%, right? Who does that impact?

ByteMe - Thugs vs. Ilk... in 3D!

October 15th, 2012
7:53 am

*TOTAL SAVINGS: $2.5 Trillion over Ten Years

Or, in English, only 25% of the current $1T deficit this year. While simultaneously throwing a lot of people out of work, which increases the deficit further via unemployment benefits, thereby reducing the actual impact. See how that works?

TMANIA

October 15th, 2012
7:55 am

Ken – Kudos to you this fine morning. The scary thing is your list probably doesn’t include a lot more programs that we should/could eliminate. Well done sir. Looking forward to seeing the screaming about all those vital programs.

stands for decibels

October 15th, 2012
7:55 am

While simultaneously throwing a lot of people out of work

Dude. That’s a feature, not a bug.

Jay

October 15th, 2012
7:55 am

As Snopes explains — http://www.snopes.com/politics/taxes/ryanbudgetcuts.asp — that list of cuts published by Ken was part of a bill introduced by an obscure Republican, Rep. Jim Jordan of Ohio. It was deep-sixed into a committee by the Republican leadership and never seen again, except in countless emails.

If the Republicans themselves don’t dare to even hold a committee vote on such cuts, trying to sell them as realistic options is utter nonsense, right Ken?

Jm

October 15th, 2012
7:56 am

Obama’s only deficit reduction proposal had $3 in tax increases for every $1 in spending cuts.

There’s your choice.

Gravy Train

October 15th, 2012
7:56 am

Jay, I’ve got to give you credit for at least crunching some numbers. Willard and Boy Blunder have shown quite the aversion to such details. They remind me of used car salesmen who push lemons. “This 35 year old beauty might have never really ran and it’s got a lot of miles on it, but they’re all miles from a nice old mormon lady and we just repainted it. You’d be crazy not to buy it, right?”

ByteMe - Thugs vs. Ilk... in 3D!

October 15th, 2012
7:56 am

Obama’s only deficit reduction proposal had $3 in tax increases for every $1 in spending cuts.

That is exactly backward from what he proposed. I’m assuming it’s an intended typo on your part. :)

ByteMe - Thugs vs. Ilk... in 3D!

October 15th, 2012
7:57 am

They remind me of used car salesmen who push lemons.

I wonder if “used car salesman” will enter the mainstream consciousness the way “malarky” just did?

bookman parrot

October 15th, 2012
7:59 am

Jay “falseness”
BHO is going to reduce the deficit. Just talk. Had 4 years. Increased $5trillion.
The despised 47. Out of context. Just said 47 would never vote for Romney.
But lib media twisted, as usual.

bob

October 15th, 2012
8:00 am

Jay, did democrats completely fund medicare or medicaid ? And you try to compare what you say what Romney would do vs what Obama would do. The Obama numbers over the last 4 years are quite a bit higher than what you use moving forward, why should we think that the guy who told us would cut the deficit in half his first term but actually had trillion dollar deficits will now slow spending ? Why does he get a pass knowing he failed to come through ?

Jay

October 15th, 2012
8:00 am

“You do realize that if the “Bush” tax-cuts are allowed to expire, without additional action, even the lowest current rate (10%) doubles to 20%, right?

No, we don’t “realize” that, because you cannot “realize” something that is not true.

You can be duped into believing it, you can fool yourself into believing it, but you cannot “realize” it.

http://www.smartmoney.com/taxes/income/how-the-expiring-bush-tax-cuts-affect-you/

ByteMe - Thugs vs. Ilk... in 3D!

October 15th, 2012
8:03 am

BHO is going to reduce the deficit. Just talk. Had 4 years. Increased $5trillion.

Now who’s doing “falseness” here? DEBT increased, but the deficit is about where it was when BO took office … which is pretty damn good for a credit crisis response. Look it up!

Jm

October 15th, 2012
8:03 am

Georgia on my mind...

October 15th, 2012
8:04 am

IMPLICATIONS OF GOVERNOR ROMNEY’S TAX PROPOSALS: FAQS AND RESPONSES

A recent TPC paper examined tradeoffs among revenues, progressivity and tax rates in tax reform. It concluded that, under certain assumptions, any revenue-neutral plan along the lines Governor Romney has outlined would reduce taxes for high-income households, thus requiring higher taxes on other, even if the plan’s financing is as progressive as possible, given the available tax expenditures. This paper addresses questions about that study and discusses new estimates that incorporate the taxation of municipal bond interest and the taxation of inside buildup in life insurance vehicles. These additions do not change the basic results.

http://www.taxpolicycenter.org/UploadedPDF/1001631-FAQ-Romney-plan.pdf

Jay

October 15th, 2012
8:04 am

Bob, given the economic calamity that greeted Obama, cutting the deficit was absolutely the last thing he should have been concerned with. Trying to cut the deficit with the economy collapsing would have sent us into something perhaps worse than the Great Depression.

Even now, Republicans are deploring the looming “sequestered” budget cuts that are scheduled to take place next year because of the 2.14 million jobs that will be lost. And you want Obama to cut even more? You wanted him to make those cuts in the teeth of the crisis?

Jm

October 15th, 2012
8:06 am

Byteme nope

Those were Orszag’s own numbers

ByteMe - Thugs vs. Ilk... in 3D!

October 15th, 2012
8:09 am

Those were Orszag’s own numbers

Linkee?

jconservative

October 15th, 2012
8:11 am

In the early 1980’s the American voter realized that they could legally raid the Treasury and get away with it. The method of raiding was a series of tax cuts. Now a majority of voters will vote against any attempt to remove the tax cuts or any request to pay back the money. So the $16 trillion in debt continues to sit with no one making any plans to pay it back.

Every dime of spending and tax cuts made by all presidents since that 1980’s tax and spending change has been approved by Congress. So it is not just Reagan or Obama’s spending, it is Congress’ spending. But most voters will keep their congressman and senators and blame the president. It is what we do. It is what we do best.

Georgia

October 15th, 2012
8:11 am

If the deficit was going to kill us, it would have already killed us. Debt levels that astonish us are always described as the biggest in history. A dollar in WW2 is only worth about seven cents now.

The whole issue is a big so what.

Poor Boy from Alabama

October 15th, 2012
8:13 am

JB:

The GAO has done a comprehensive analysis that identified significant amounts of duplication and inefficiencies within the federal government, In testimony before Congress, the head of the GAO noted that tens of billions of dollars could be saved annually.

http://www.gao.gov/products/GAO-12-449T

Senator Coburn of OK thinks the potential savings could be $100 billion per year.

http://www.coburn.senate.gov/public/index.cfm/pressreleases?ContentRecord_id=9f71c934-b926-47ee-a6f8-662d5225517f

Whether the number is tens of billions or $100 billion, it’s clear that the federal government needs to be streamlined. The idea of running a tighter ship seems to be off the radar these days. That’s truly unfortunate.

AU Liberal in ATL

October 15th, 2012
8:13 am

Fact is most voters really don’t give a damn about the deficit. If they don’t see it in their own checking accounts it doesn’t exist for them. It’s pretty amazing that so many people completely ignore politics in this country. They just don’t seem to realize how dramatically politics affects people. It’s not just some ideological stance, it’s real, it’s personal, it makes and breaks people every day. But most voters just don’t get it. Far too many voters happily, merrily go to the polls and vote against their own best interests. They do it over and over again. The republican south pretty much proves my point.

stands for decibels

October 15th, 2012
8:14 am

Jm

October 15th, 2012
8:15 am

“cutting the deficit was absolutely the last thing he should have been concerned with”

No worries there for liberals.

He still doesn’t plan to cut the deficit.

There’s your choice.

Large deficit with Obama

Small deficit with Romney

Jay

October 15th, 2012
8:16 am

“The idea of running a tighter ship seems to be off the radar these days.”

No, Alabama, it is not. From your very own GAO link:

“In our 2011 follow-up report, we assessed the extent to which Congress and the executive branch addressed the 81 areas—including a total of 176 actions—to reduce or eliminate unnecessary duplication, overlap, or fragmentation or achieve other potential financial benefits. As of February 10, 2012, Congress and the executive branch have made some progress in addressing the majority of the 81 areas we identified; however, additional steps are needed to fully implement the remaining actions. Specifically, our assessment found that all actions had been addressed in 4 areas, partially addressed in 60 areas, and not addressed in 17 areas.”

PJ

October 15th, 2012
8:18 am

The biggest problem I have with Romney-math is that he proposes to cap spending 20%, which is over $600B in cuts today, while also pledging to balance the budget. But revenue has been under 16% for 4 years. Unless the Bush cuts expire, that won’t change all that much. The estimate with them expiring only gets us to close 18%.
So, by pledging a revenue-neutral tax policy, Romney will have at least a 4% deficit, or $640B, and we all know how well massive cuts go over in Congress.
And if you are one of the people screaming about the $16T debt, we need revenue to exceed spending to begin to pay it down and even R’s say we need 18-20% spending. So please come up with a way to get revenue above that. And don’t say growth because we only exceeded 18% once under W, 2007, at the height of the bubble.

stands for decibels

October 15th, 2012
8:19 am

More about why this aforementioned evil menace is hurting America.

Walker and Peterson tell a simple and familiar story: America is broke and spending is out of control.

The imprimatur of a former comptroller general has allowed such an argument to be taken not only seriously, but nearly for granted in Washington. Of course, the United States is not actually broke. It’s the richest country on the planet. And while government spending has indeed increased, as one would expect during a recession, a major driver of the deficit has been a collapse in government revenue, along with two unpaid-for wars.

The quickest way to close that revenue gap would be a return to the previous tax rates on the wealthy, including on investment managers who pay a discounted rate by referring to their income as interest or dividends. Such a policy change would cost Peterson millions, a prospect he has argued against in the past. “This is a fairness argument,” he said in 2008, according to The New York Times. “There are so many other partnerships, why pick on this high-growth sector?”

Peterson is in this debate for the long haul: He’s even working on children. Earlier this month, Columbia University’s Teachers College released a new curriculum about the federal budget and fiscal policy that will be distributed free to every high school in the country. “Understanding Fiscal Responsibility” was introduced at a ceremony featuring Peter Orszag, a former Obama administration official who left to join Citigroup. The Peterson Foundation has already given $1.6 million of a promised $2.4 million for the curriculum.

The first two lessons are titled “Social Security and the National Debt” and “Medicare and the National Debt.” The curriculum wants teens to ask, “How high a value do we place on guaranteeing quality health care to the elderly?”

Aquagirl

October 15th, 2012
8:20 am

Whether the number is tens of billions or $100 billion, it’s clear that the federal government needs to be streamlined.

We could start with the massive defense industry subsidies providing crap the military doesn’t want, but according to Republicans that’s hating on the troops and letting the terrorists win.

Gravy Train

October 15th, 2012
8:21 am

Jay, maybe tomorrow you can tackle Willard’s plans for foreign policy. When Boy Blunder was pressed on this issue, he basically said “We’re going to do the same thing as Obama. It will just look better because we will talk tougher and rattle our sabers louder.” Does this mean another war? Boy Blunder: “Uh, well, but Benghazi…”

JKL2

October 15th, 2012
8:22 am

Jay- But spending buys votes.” So do tax cuts.

So obama “buying” 47% of the vote is OK but Romney’s 1% is evil. Got it.

To fit the George Soros new world order, median household income needs to drop to $14.4k. Don’t forget to tell all those welfare queens they are now considered “evil rich” and are going to have to pay their fair share in obamaland.

Poor Boy from Alabama

October 15th, 2012
8:23 am

JB,

No offense, but do you think the “progress” noted by the GAO has yielded a single dollar of savings? :-)

I haven’t seen much coverage of the GAO report in the press and I haven’t heard any mention of it in any of the political debates (Republican primary, presidential or vice presidential) we’ve had this year. I’d say that’s off the radar.

Doggone/GA

October 15th, 2012
8:29 am

“So obama “buying” 47% of the vote”

When you have to like to make your point, you have no point..

Jay

October 15th, 2012
8:30 am

The GAO says that significant progress is being made, Poor Boy.

I don’t know why you would cite them as evidence that change is necessary and then dismiss them when they say those changes are occurring.

Road Scholar

October 15th, 2012
8:30 am

As to the “sequestered” cuts, didn’t both the repubs and dems agree to them? So why the whining?

indigo

October 15th, 2012
8:33 am

There is no good reason for us to be spending so much on our Military. We do not need to be defending Korea, Japan and much of Europe any more. These countries are, in many cases, prospering more than us and should be able to look after themselves.

Republicans run from these facts as fast as possible because the Military-Industrial-Complex is their main source of campaign funding. They are more than happy to put Party over people to get themselves elected and re-elected. For the same reason, caring for the rich is a number one priority with them.

Vote accordingly.

Jm

October 15th, 2012
8:34 am

Byteme

You can find the Orszag quote somewhere on cspan I’m sure

It was at a deficit conference shortly after he left the administration

Doggone/GA

October 15th, 2012
8:35 am

“So why the whining”

I see it as sort of like the “balloon payment” mortgages. People get so used to the lower payments the first few years, they’re shocked when their payment increase significantly at the end of the lower payment period. Yes, it was agreed to by both sides…but at least one side was just SURE they could get some changes passed before the deadline hit. Hasn’t happened so far…hence the whining.

kayaker 71

October 15th, 2012
8:39 am

It seems that neither party wants to cut a program or entitlement scheme if, by doing so, they would lose votes. Feathering the nest of the voter has been prevalent in this country for decades. But the poor military….. they get it in the shorts every time. Defending this country against those who would do it harm is an expensive undertaking. A famous American president once said, ” You don’t win wars by being too strong”.

rightwingextreme

October 15th, 2012
8:40 am

Top 5% of Wage Earners pay 54.36% of all Federal Income Taxes or 95% pay 45.64%
Top 10% of Wage Earners pay 65.84% of all Federal Income Taxes or 90% pay 34.16%
Top 50% of Wage Earners pay 96.54% of all Federal Income Taxes or 50% pay only 3.46%

Kinda puts into perspective who is paying taxes at the Federal Level and who is not.

Now, where should the tax cuts be?

Poor Boy from Alabama

October 15th, 2012
8:41 am

JB,

Here’s what the head of the GAO said in his testimony before Congress:

In our 2011 follow-up report, we assessed the extent to which Congress and the executive branch addressed the 81 areas—including a total of 176 actions—to reduce or eliminate unnecessary duplication, overlap, or fragmentation or achieve other potential financial benefits. As of February 10, 2012, Congress and the executive branch have made some progress in addressing the majority of the 81 areas we identified; however, additional steps are needed to fully implement the remaining actions. Specifically, our assessment found that all actions had been addressed in 4 areas, partially addressed in 60 areas, and not addressed in 17 areas. In addition, OMB has instructed agencies to consider areas of duplication or overlap identified in our 2011 report and by others in their fiscal year 2013 budget submissions and management plans. The OMB guidance also advised agencies to take a number of other steps to enhance efficiency, such as identifying and including in their budget submissions cost-saving efforts that will improve operational efficiency and taxpayers’ rate of return, including program integration, reorganizations within and between agency components, and resource realignment to improve public services.
Under requirements

It’s clear that very little, if any, of the identified savings have been realized.

The problem is not with the GAO’s analysis, it’s with the executive and legislative branches of government.

Jay

October 15th, 2012
8:42 am

“It’s clear that very little, if any, of the identified savings have been realized.

No, it is not clear. Nothing in what you quote can be cited as evidence of what you claim.

Peadawg

October 15th, 2012
8:44 am

“You can find the Orszag quote somewhere on cspan I’m sure”

Then go find it since you made the claim.

stands for decibels

October 15th, 2012
8:45 am

As to the “sequestered” cuts, didn’t both the repubs and dems agree to them? So why the whining?

Because they have to pretend like they were ever going to go ahead and do what they “promised” (heh heh, my fingers were crossed so it doesn’t count!) to do.

I’m sorry, does ANYONE here really believe that they really intended to go through with the cuts once this phony deadline arrived?

anyone?

kayaker 71

October 15th, 2012
8:46 am

It’s so easy for Congress and their cronies to hide money. All of this shuckin’ and jivin’ about cuts usually produces virtually nothing in the way of concrete results. Both parties are guilty as sin in this regard…… and if you don’t believe that, you have a lot to learn.

stands for decibels

October 15th, 2012
8:47 am

Kinda puts into perspective who is paying taxes at the Federal Level and who is not.

yes, if you continue to concentrate wealth upward, those well-off folks will wind up shouldering more of the tax “burden.”

Thanks for bringing up this issue of wealth inequality.

Jay

October 15th, 2012
8:47 am

Nice how you exclude payroll taxes from your data, Extreme.

One might think you were trying to disguise reality by doing that.

Granny Godzilla - Union Thugette

October 15th, 2012
8:47 am

rightwingextreme

October 15th, 2012
8:40 am
Top 5% of Wage Earners pay 54.36% of all Federal Income Taxes or 95% pay 45.64%
Top 10% of Wage Earners pay 65.84% of all Federal Income Taxes or 90% pay 34.16%
Top 50% of Wage Earners pay 96.54% of all Federal Income Taxes or 50% pay only 3.46%

Kinda puts into perspective who is paying taxes at the Federal Level and who is not.

Now, where should the tax cuts be?

.
.
.
.

20% Of Americans (not all wage earners BTW) own 88% of the nations wealth.

http://www2.ucsc.edu/whorulesamerica/power/wealth.html

Now, where should there be tax increases?

bob

October 15th, 2012
8:48 am

Indigo, how can you blame repubs for Korea and the military industrial complex ? Repubs were not in power when Truman decided to attack Korea. By the time Ike warned of the military industrial complex, the dems that had run congress had already built it. I guess you blame Vietnam on repubs as well ? Show us how repubs are at fault for putting troops in Japan or Germany or Korea !

DownInAlbany

October 15th, 2012
8:48 am

I missed-typed, there Jay. OK, 10% goes to 15% (not, 20% that I mentioned.) From your link: Higher Tax Rates for All

Also See
10 Things the IRS Won’t Tell You
10 Things I Hate About Tax Day
Skip the Dorm, Buy Your Kid a Condo
How to Use the IRS as a Credit Card
Give Your College Kid a Tax Break

.
You may think only individuals in the top two brackets will face higher federal income taxes if the Bush cuts go bye-bye as scheduled on Jan. 1, 2013. Not true. Unless Congress takes action and the president goes along (whoever that is), rates will go up for everyone — not just “the rich.” Specifically, the existing 10% bracket will go away, and the lowest “new” bracket will be 15%. The existing 25% bracket will be replaced by the “new” 28% bracket; the existing 28% bracket will be replaced by the new 31% bracket; the existing 33% bracket will be replaced by the 36% bracket; and the existing 35% bracket will be replaced by the 39.6% bracket.

Bottom line: We’ll all see higher taxes.

Higher Capital Gains and Dividends Taxes for All

Harsher Marriage Penalty

So, the bottom rate (10%) goes to 15%…and your point is? This is a good thing? What do you “realize” now?

Common Sense

October 15th, 2012
8:48 am

:Which is why Republicans created Medicare Part D without finding the money to fund it, and why, for the first time in our nation’s history, they cut taxes in wartime, wartime in this case meaning two major wars.”

In 2008 America elected a democratic President that had control of both the House and the Senate. If there was a real issue with these programs you have outlined, then why did the Democrats not do the right thing and overturn them?

By not overturning it, then have in effect, approved it. That is how the system is meant to work, after all.

Or did our Constitutional scholar not realize this?

Welcome to the Occupation

October 15th, 2012
8:49 am

Jay: “Once politicians and pundits start talking in terms of hundreds of billions and even trillions of dollars, eyes glaze over

It’s actually much worse than that. The fact is that the American voters are by and large simply unprepared to believe what one wing of the ruling class is prepared to inflict on it.

It’s a simple question of belief.

When they were gathered in focus groups and told of the Republican plans, they simply rejected it out of simple disbelief, unable to bring themselves to accept that a movement that marches under the banner of one of the two major American parties – and thus has the imprimatur of institutional legitimacy – would inflict a plan as vicious as this against them, blatantly expropriating even more wealth from the low and middle and funneling it upwards to the already phenomenally wealthy and us still reeling from the worse economic downtown in a century. They simple wouldn’t believe it.

And this is the most gigantic problem we face. How do you get the battered wife to accept that she’s getting beaten up when she refuses to believe you even when you’re pointing out to her all the black and blue marks on her body?

Doggone/GA

October 15th, 2012
8:49 am

“Kinda puts into perspective who is paying taxes at the Federal Level and who is not”

Now put up a list of what percentage of the nation’s wealth each of those groups controls.

RB from Gwinnett

October 15th, 2012
8:49 am

More propaganda from the DNC brought to you by stooge Bookman. Jay, this isn’t simple, it’s simple minded. I’ll give you credit for weaving in the old people and children scare tactics, but you let out pushing wheelchairs off cliffs, guard dogs, and water hoses.

Ol’timer, 2 simple points to pretty much put your arguments to rest. 1-the tax rates on the books today were signed into law by Obama, not bush. If you can’t be any more accurate or honest than that, nobody cares to hear the rest of your argument. 2-the income to the govt may be down and the % of the GDP it represents may be steady, but the number of people footing the bill continues to decline. My guess is you’re another one of the 47% whining about what others pay while you pay nothing.

jms

October 15th, 2012
8:52 am

Four years ago Obama had a plan to cut the deficit. He had his chance and he did not deliver.

Road Scholar

October 15th, 2012
8:52 am

Doggone “…but at least one side was just SURE they could get some changes passed before the deadline hit. ”

They didn’t do their job. But yet they whine.Live with it until you take bipartisan action

RWE;”Now, where should the tax cuts be?”

NONE! If the deficit reduction is so damn important, NO tax cuts. They have been proven numerous times that they do not spur economic activity, or help reduce the deficit. We need to stop kidding ourselves..and yourself. Yes it makes the US taxpayer “feeeeeeeeeeeeeeel goooooood, but let’s get serious….or just shut up!

indigo

October 15th, 2012
8:54 am

bob – 8:48

I’m talking about NOW, RIGHT NOW.

Citizen of the World

October 15th, 2012
8:55 am

Romney is hamstrung by ideological purity, the Republican party line which says you cannot raise taxes on the “job creators” without hurting the economy, and you can’t reduce military spending with threatening national security. So he has to make up a fairy tale in which he just waves a magic wand, Big Bird is vanquished, prosperity is restored, and all is well.

Granny Godzilla - Union Thugette

October 15th, 2012
8:57 am

Common Sense

October 15th, 2012
8:48 am

In 2008 America elected a democratic President that had control of both the House and the Senate.
.
.
.
.
The lie that would not die.

Stevie Ray..Clowns to the left and Jokers to the right..here I am...

October 15th, 2012
8:58 am

Jay,

I think you are forgetting to factor in 120 billion for heathcare costs (unless I’m missing something)..which I recall your savior and pals suggested would originally be deficit neutral (Romneyesque slice of BS) or actually lower costs but I think the current cost is $1.2 trillion over next 10 years…or 120 billion a year including estimate of tax penalties…..

Of that total, 1.1 trillion are for exchange subsidies…have they ever been correct on cost of government entitlements..

Not to mention the premium increases those who will be subsidizing the loss ridden state exchanges….significant slice of pie don’t you think?

Again, unless I’m forgetting something, this results in your number under President Trillions plan changes to $80 billion as this offsets defense spending cuts..ergo, we still have 420 billion to find…

Jay

October 15th, 2012
8:58 am

You “mis-typed”, Albany?

How do you “mistype” 15 as 20?

Furthermore, the current 10 percent rate applies only to those making less than $9,000. Not many people are affected by it.

Poor Boy from Alabama

October 15th, 2012
8:59 am

JB,

Four out of 81 areas have been fully addressed and you say it’s not clear that very little, if any of the identified savings have been realized? Really? Isn’t 4 out of 81 about 5%?

No problem. Let’s go to the specifics from congressional testimony. Here are the four areas that have been fully addressed:

US Dept. of Energy:

Addressing duplicative federal efforts directed at increasing domestic ethanol production could reduce revenue losses by more than $5.7 billion annually

Homeland Security/Law Enforcement:

The Department of Justice plans actions to reduce overlap in explosives investigations, but monitoring is needed to ensure successful implementation

International Affairs:

Despite restructuring, overlapping roles and functions still exist at the Department of State’s Arms Control and Nonproliferation Bureaus

General Government:

IRS may be able to systematically identify nonresident aliens reporting unallowed tax deductions or credits

As I said before, not much money has been actually saved.

QED JB?

Road Scholar

October 15th, 2012
9:00 am

CS:” ….then why did the Democrats not do the right thing and overturn them?”

If you don’t realize it is hard to “overturn” a war esp 2 of them! President Obama got us out of Iraq. He is getting us out of Afghanistan (2014). 2/3rds down or going down even though funding for the bi-products of war just keep on giving. As for Medicare, what do you propose?

Stevie Ray..Clowns to the left and Jokers to the right..here I am...

October 15th, 2012
9:02 am

“Trickle down government” …one of the best lines from GOP amongst a bunch of absurdity..

We should cut defense 20% and every other category by 10%…why is that so difficult?? Everybody seems to have a sacred cow but we all know sacred cows make the best burgers..

Jay

October 15th, 2012
9:03 am

“Not much money”, Poor Boy, yet in your first example of fully realized reform we’re talking almost $6 billion?

You also neglect to mention that by GAO’s account, progress has been made in 60 other areas.

QED for damn sure.

Citizen of the World

October 15th, 2012
9:07 am

Gee, jms @ 8:52

Why *didn’t* Obama deliver on his original plan to cut the deficit? What could possibly have interfered with that plan?

Jay

October 15th, 2012
9:07 am

“I think you are forgetting to factor in 120 billion for heathcare costs (unless I’m missing something)..which I recall your savior and pals suggested would originally be deficit neutral (Romneyesque slice of BS) or actually lower costs but I think the current cost is $1.2 trillion over next 10 years…or 120 billion a year including estimate of tax penalties…..

You recall incorrectly, Steve. Here’s what the CBO and the bipartisan Joint Committee on Taxation told Speaker Boehner in a letter in July:

“CBO and JCT estimate that, on balance, the direct spending and revenue effects of enacting that legislation would cause a net increase in federal budget deficits of $109 billion over the 2013–2022 period. Specifically, we estimate that H.R. 6079 would reduce direct spending by $890 billion and reduce revenues by $1 trillion between 2013 and 2022, thus adding $109 billion to federal budget deficits over that period.”

In other words, repealing ObamaCare INCREASES the deficit and debt.

Thomas

October 15th, 2012
9:08 am

Once again a pathetic blog. Bookie just informed us the Raiders won yesterday because the gained more yardage. Atlantans deserver better as it is impossible to learn from this malarky of a blog.

East Cobb RINO, Inc. (LLC)

October 15th, 2012
9:08 am

The one item on that long list of cuts posted by Ken was the 775M for the Presidential campaign fund. Now that corporations are footing the bill for this we can surely do away with that.