I am a staunch supporter of the middleclass. In fact I blog a lot on the wealthy pilfering the middleclass because of beneficial tax policies and other policies they get because they purchase politicians. In fact I have written a book about detailing how Class Warfare from the wealthy could ultimately be mitigated.
The reality is that the country is in a bind and we will eventually have to do something about the budget. Keynesian economics has proven itself over decades and as such budget cuts must be delayed till the economy is more stable.
That said, I read the entire 50 page document and there is a lot to like. I support having all income treated equally whether it is work income or capital gains. Today middleclass can pay up to a 35% tax rate while a wealthy person dependent on capital gains pay a maximum of 15%. Potentially Option 1 in this documents fixes that. I would support putting a surtax on the wealthy based the over performance based on beneficial policies not available to the middleclass.
We can all agree however that we must put everything on the table as long the ultimate result is fair (e.g., means testing for social security). COMMENTS?
My Book: As I See It: Class Warfare The Only Resort To Right Wing Doom
Book’s Webpage: http://books.egbertowillies.com – Twitter: http://twitter.com/egbertowillies
Today’s upcoming report by the White House’s fiscal commission is expected to include recommendations to raise the retirement age for Social Security and cut Medicare benefits — two policy prescriptions that will be met with deep opposition from Democrats and some Republicans — according to a source who has been briefed on the proposal. The chairmen of the commission will unveil their overarching recommendations for debt and deficit reduction on Wednesday afternoon, weeks before the official unveiling is expected.
The findings are not the final report of the commission, officially known as the National Commission on Fiscal Responsibility and Reform. Rather they are the specific suggestions of its two chairs, former Sen. Alan Simpson and former White House Chief of Staff Erskine Bowles. The ultimate findings will require the support of 14 members of the 18-member commission. And at this juncture it is unclear if the votes are there, sources familiar with deliberation say.
In the process of pursuing their reforms for Social Security and Medicare, the commission chairs are expected to suggest that the end result will be a 70 percent cut in benefits and 30 percent increase in revenues, according to the source familiar with the upcoming announcement.
"What a crazy proposal, what a crazy proposal," said a Democratic source briefed on the findings. "I expect that the White House is going to distance itself big-time from this, saying this is just the chairman not the commission."
3:33 PM ET Disagreement On Panel
Bloomberg News has more on the recommendations and is already recording discord from members of commission.
The chairmen’s plan is already causing some Democrats and Republicans on the 18-member commission to balk. The plan will be announced at 1 p.m. Washington time today, said commission spokesman Fred Baldassaro.
"This is not a package that I could support," Representative Jan Schakowsky, an Illinois Democrat, said during a break in a private meeting by the commission. She said any package able to win 14 votes on the panel would have to look "very different" from the options being discussed.
3:35 PM ET The Details
The draft put out by the commission chairs has been released, coming in at 50 pages. The overarching goal, Simpson and Bowles write, is to achieve "nearly $4 trillion in deficit reduction through 2020" while reducing "the deficit to 2.2% of GDP by 2015."
How they get there is going to be a matter of contention as other commission members have already stressed their displeasure with the suggestions. But here are a few of the more noteworthy suggestions.
- Roll discretionary spending back to FY2010 levels for FY2012, requires 1% cut in discretionary budget authority every year from FY2013 though 2015;
- Fully offset the cost of the "Doc Fix" by asking doctors and other health providers, lawyers, and individuals to take responsibility for slowing health care cost growth;
- Reduce farm subsidies by3 billion per year by reducing direct payments and other subsidies;
- Achieve100 billion in Illustrative Defense Cuts;
- Index retirement age for Social security to increases in longevity. "This option is projected to increase the age by one month every two years after it reaches 67 under current law, meaning the normal retirement age would reach 68 in about 2050 and 69 in about 2075." There will be a "hardship exemption" for those unable to work beyond 62;
- Give retirees the choice of collecting half their benefits early and the other half at a later age to minimize impact of actuarial reduction and support phased retirement options;
- Reduce corporate tax rate to 26% and permanently extend the research credit;
- Gradually increase gas tax to fund transportation spending.
3:37 PM ET Beyond Social Security
A more detailed list of discretionary spending cuts proposed by Simpson and Bowles has been released. Below are a few of the more notable bites at the apple:
- Reduce Congressional & White House budgets by 15 percent;
- Freeze federal salaries, bonuses, and other compensation at non-defense
agencies for three hears;- Cap the number of federal political appointments at 2,000;
- Eliminate the Office of Safe & Drug Free Schools;
- Eliminate all earmarks.;
- Reduce unnecessary printing costs;
- Reduce funding to the Smithsonian and the National Park Service and allow the programs to offset the reduction through fees;
- Cut funding for the Corporation for Public Broadcasting.
