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Fixing the Budget (Part Two)

Again, I’d like to point all of my readers to a nice interactive graphic on New York Times.com. Yesterday, I focused on domestic programs, foreign aid and the military. Today, I’m going to look at taxes and healthcare.

Healthcare

Enact Medical Malpractice Reform – according to the Congressional Budget Office this would save $8 billion in the short term and $13 billion in the long term. I could talk about malpractice reform for hours. I think it needs to be done. I also think that patients who are harmed should have some restitution. We can talk about this another day. Right now, let’s enact malpractice reform.
Reduce the tax break for employer-provided health insurance – this would reduce the tax rate for employer-based health insurance by slowly adjusting the tax rate. That, in theory, increases the rate of economic growth. This should save $41 billion in the short term and $157 billion in the long term.
I would not increase Medicare eligibility to 68 or to 70.
I would not artificially try to control the growth of Medicare.
In my opinion, the way to control Medicare costs is to allow the government to negotiate drug prices and change the way we pay doctors and hospitals.

Social Security

Raising the Social Security retirement age to 68 would save $13 billion in the short term and $71 billion in the long term. I don’t support this.
Reduce Social Security benefits for those with higher incomes – basically, this would set up three categories based on lifetime earnings. This would save $6 billion in the short term and $54 billion in the long term. I like this.
Tighten eligibility for disability – although this could save $9 billion in the short term and $70 billion in the long term, I don’t support it.
Use an alternative measure for inflation – this would save $21 billion in the short term and $82 billion in long term. I don’t support this. I think that seniors who need Social Security should get Social Security.

Existing Taxes

The Lincoln – Kyl proposal – this is basically rewriting the estate tax. The first $5 million would be exempt. I don’t support it.
President Obama’s proposal – this is also a derivation of the estate tax. The first $3.5 million would be exempt. Everything above $3.5 million would be taxed at 45%. I don’t support this.
Return to the Estate Tax during the Clinton Era – as they were back in the ’90s, estates less than $1 million would be exempt. There’s a variable rate between 18% to 55% up to $3 million. Everything is taxed at 55% over $3 million. This saves us $50 billion in the short term and $104 billion in the long term. I do support this.
Investment taxes – return to Clinton-era tax levels – 10% capital gains taxes for low-income households and 20% capital gains taxes for everyone else. Dividends would be taxed at the same rate as ordinary income. This would increase short-term revenue by $32 billion and long-term revenue by $46 billion.
Let the Bush-era tax cuts expire for incomes above $250,000 – this would raise $54 billion in the short term and $115 billion in the long term. I do support this. Although there’s been talk about allowing the Bush-era tax cuts to expire on those Americans making less than $250,000 a year I don’t think that that is wise.
Increase the payroll taxes on incomes above $106,000 – I think we can talk about this at a later date. I think it probably does need to be done but I don’t think it needs to be done right now.

New Taxes and Tax Reform

Millionaire tax on income above $1 million – currently the top tax bracket ends at $375,000. This would add a top tax bracket on top of that. This would increase the tax rate by 5.4% for those households making over $1 million a year. This would raise $50 billion in the short term and $95 billion in the long term. I support this.
Eliminate loopholes and keep taxes slightly higher – the Cat Food Commission (also known as the Simpson-Bowles Deficit Commission) suggested that we could close loopholes and then lower the tax rate since we would collect taxes more efficiently. I suggest we close the loopholes and once we’re rolling in money and have paid down our debt, let’s give rebates to Americans who need it. So, this would save $136 billion in the short term and $315 billion in the long term.
Reduce mortgage deduction and others for high income households – I don’t support this.
National sales tax – I don’t support this either.
Carbon tax – this would tax carbon emissions. I think this has to be done. This would raise $40 billion in the short term and $71 billion in the long term.
Bank tax – this would tax banks based on the size of their holdings and the perceived riskiness of their holdings. Larger and riskier banks would pay more tax. Then, the next time they try to drive us off a cliff, at least they’ve paid for the riskiness. This would save $73 billion the short term and $103 billion the long term. I support this tax.

By using the sensible cuts and tax increases that I’ve laid out in these last two posts, I have fixed our short-term deficit problem and I have fixed our long-term deficit problem. In the short term, I have saved $697 billion. In the long term, I’ve saved $1.362 trillion. To me, the bottom line is no one has to go hungry. No one has to do without Medicare or Social Security in order for us, Americans, to balance our budget. If we ask those who make a good living to give a little bit more, we’re golden. It is that simple.

What are your thoughts?

By |2011-08-12T17:43:51-04:00August 12th, 2011|Economy|Comments Off on Fixing the Budget (Part Two)

Fixing the Budget (part one)

Several months ago, I pointed all of my readers to a simple graphic that the New York Times had on their website. It was an interactive graphic in which you could fix the budget. I’d like to return to this graphic and show how very simple it is to fix the budget with some simple fixes. If you do not adhere to rigid ideology we can fix this. Remember, our goal is a combination of short-term and long-term savings.

Domestic Programs and Foreign Aid

Cut foreign aid in half – we can save $17 billion. Let’s hold on this for now. I think that foreign aid is extremely important.
Eliminate earmarks – yes, we need to eliminate earmarks. I just don’t see that earmarks helps us or our democracy. This saves $14 billion.
Eliminate farm subsidies – since most of our farm subsidies go to large corporations, I don’t think that this really helps us. Cutting this will save us another $14 billion.
Cutting paper civilian federal workers by 5% – this would save $14 billion in the short term and $17 billion in the long term. I don’t think this helps our financial situation and it hurts federal workers. I would not support this.
Reduce the federal workforce by 10% – this would save $12 billion in the short term and $15 billion in the long term. Cutting jobs hurts the economy. I wouldn’t do it.
Cut 250,000 government contractors – I would do this. This would save $17 billion both in the short term and the long term.
Cutting other federal programs – this would include reducing funds to the Smithsonian and cutting our National Park Service. This would add up to $30 billion both in the short term and in the long term. I do not support this.
Cutting aid to states by 5% – this would save $29 billion in the short term and $42 billion in the long-term. States are hurting. By cutting aid to states, states will then turn around and cut jobs. This will hurt our long-term growth. I would not support it.

Military

Reduce nuclear arsenal and space spending – this would reduce our near-term deficit by $19 billion and our long-term deficit by $38 billion. This would reduce our nuclear warheads from around 2002 closer to 1000. I do support this.
Reduce military to pre-war size and further reduce troops in Asia and Europe – this would save $25 billion in the short term and $49 billion in the long term. I think that this is a must.
Reduce Navy and Air Force fleets – this would reduce the Navy by 48 ships and retire 37 ships early. The Air Force would retire two tactical fighter wings and reduce the number of fighter jets that are currently planned to be purchased. This would save $19 billion in the short term and $24 billion in the long term.
Cancel or delay some weapons systems – there are some weapons systems, like the Osprey, that have been around for years. These have had some modest success, but I think they need to be eliminated. Put them back in moth balls of necessary. This would save $19 billion in the short term and $18 billion in the long term.
Reduce non-combat military compensation and overhead – this would change health-care plans for military personnel who were not injured in battle. I do not support this. Although this would save $23 billion in the short term and $51 billion in the long term, I think we need to meet our obligations to our military personnel.
Reduce the number of troops in Iraq and Afghanistan to 60,000 by 2013 – we need to bring our troops home. They need to come home as quickly as possible. This would save $86 billion in the short term and $169 billion in the long-term.

So far, we have saved $213 billion in the short term (2015) and $343 billion in the long term (2030). I think that all of these cuts are reasonable. We still have more work to do. We need to talk about healthcare, Social Security and our existing tax structure. Let’s do a little bit more of this later.

By |2011-08-11T12:20:54-04:00August 11th, 2011|Budget|Comments Off on Fixing the Budget (part one)

Jessie Helms Dies

I will have a lot more to say about Senator Jessie Helms later on this afternoon. Right now, I can say that Helms should be admired by all. Whether you believe in his politics or not, he did stand by his convictions. He also showed everyone what a determined senator can do.

Think Progress points out that the former mayor of Charlotte, North Carolina, Harvey Gantt, who ran against Helms in 1990, was defeated in part by a racially based advertisement which reinforced North Carolinians worst racial fears.

From New York Times:

Jesse Helms, the former North Carolina senator whose courtly manner and mossy drawl barely masked a hard-edged conservatism that opposed civil rights, gay rights, foreign aid and modern art, died early Friday. He was 86.

Mr. Helms’s former chief of staff, Jimmy Broughton, told The Associated Press that the former senator died of natural causes in Raleigh.

In a 52-year political career that ended with his retirement from the Senate in 2002, Mr. Helms became a beacon for the right wing of American politics, a lightning rod for the left, and, often, a mighty pain for Presidents whatever their political leaning. (more… )

Update: From TCR

The WaPo’s David Broder wrote a column in August 2001, shortly after Helms announced he would not seek re-election. Broder, who would hardly qualify as a reflexive liberal ideologue, did a fine job explaining exactly what made Helms politically significant, and precisely why he’ll be remembered.

What really sets Jesse Helms apart is that he is the last prominent unabashed white racist politician in this country — a title that one hopes will now be permanently retired. A few editorials and columns came close to saying that. But the squeamishness of much of the press in characterizing Helms for what he is suggests an unwillingness to confront the reality of race in our national life. […]

What is unique about Helms — and from my viewpoint, unforgivable — is his willingness to pick at the scab of the great wound of American history: the legacy of slavery and segregation. He inflamed racial resentment against African Americans.

Many of the accounts of Helms’s retirement linked him with another prospective retiree, Sen. Strom Thurmond of South Carolina. Both these Senate veterans switched from the Democratic to the Republican Party when the Democrats began pressing for civil rights legislation in the 1960s. But there is a great difference between them. Thurmond, who holds the record for the longest anti-civil rights filibuster, accepted change. For three decades he has treated African Americans and black institutions as respectfully as he treats all his other constituents.

To the best of my knowledge, Helms has never done what the late George Wallace did well before his death — recant and apologize for his use of racial issues. And that use was blatant.

In 1984, when Helms faced his toughest opponent in Democratic Gov. Jim Hunt, the late Bill Peterson, one of the most evenhanded reporters I have ever known, summed up what “some said was the meanest Senate campaign in history.”

“Racial epithets and standing in school doors are no longer fashionable,” Peterson wrote, “but 1984 proved that the ugly politics of race are alive and well. Helms is their master.”

A year before the election, when public polls showed Helms trailing by 20 points, he launched a Senate filibuster against the bill making the birthday of Martin Luther King Jr. a national holiday. Thurmond and the Senate majority were on the other side, but the next poll showed Helms had halved his deficit.

All year, Peterson reported, “Helms campaign literature sounded a drumbeat of warnings about black voter-registration drives…. On election eve, he accused Hunt of being supported by ‘homosexuals, the labor union bosses and the crooks’ and said he feared a large ‘bloc vote.’ What did he mean? ‘The black vote,’ Helms said.” He won, 52 percent to 48 percent.

In 1990, locked in a tight race with an African American Democrat, former Charlotte mayor Harvey Gantt, Helms aired a final-week TV ad that showed a pair of white hands crumpling a rejection letter, while an announcer said, “You needed that job and you were the best qualified. But they had to give it to a minority because of a racial quota.” Once again, he pulled through.

That is not a history to be sanitized.

Helms wasn’t a nice guy or even a good guy. He was a cornerstone of the Republican party for decades. I think that this says something about the Republican party, North Carolina (the state in which I live) and the United States. Unfortunately, what it says isn’t good.

At the risk of sounding heartless, the same is true on the day of Helms’ death.

By |2008-07-04T14:16:57-04:00July 4th, 2008|Domestic Issues, Senate|2 Comments
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