Tag: Deficit Reduction

Are There Serious Solutions To Be Had?

College of Political Knowledge

Subject:  Federal Deficit/Budget Spending/ Budget Cuts

There is a good game of political tennis going on in Washington and on the airways……we all agree we need cuts, but for some reason these cowards are NOT serious about them….why?  In a word….re-election!  They will propose…they will piss and moan….they will accuse and they will cry (not necessarily Boehner)…..and in the end…we have done what the ALL say we should stop doing…..we will have kicked the can down the road…..

But are there some cuts that could be done today that would put the country on the right path to solvency?

Yes, there are some very easy cuts that could be made….but NO one in Washington has the courage to even propose let alone try to implement….

OK Professor, what cuts would you suggest at this point in the debate……

  • The extension of the Bush tax cuts for the wealthy, enacted by a Democratic-controlled Congress in December with the approval of the Obama administration, pumps $700 billion over the next ten years into the pockets of the rich. Reclaiming two years of that tax windfall would eliminate all the state budget deficits combined.
  • Total compensation at Wall Street banks and securities firms last year hit a record $135 billion, according to an analysis by the Wall Street Journal, on all-time-high revenue of $417 billion. The recipients of the Wall Street bailout could bail out the states out of their own pockets.
  • The 400 richest individuals in the United States dispose of a staggering $1.37 trillion in assets, an average of nearly $3.5 billion apiece. A levy of 10 percent on the resources of these billionaires would also erase the deficits of all 50 states.
  • Combined profits for all American corporations rocketed upwards in 2010, hitting an annual rate of $1.66 trillion in the third quarter. A tax of eight percent on those profits—the same percentage as the cut Walker seeks to impose on schoolteachers and park rangers—would eliminate all state deficits.
  • US corporations are currently sitting on $2 trillion in cash, refusing to hire workers despite collecting tax cuts that are supposed to be incentives to do so. A levy of 10 percent on that idle cash would provide enough money to eliminate not only the deficits of the states, but the deficits of all cities and local governments too, as well as preserving the jobs of hundreds of thousands of public employees.
  • Hedge funds assets rose to $1.92 trillion in 2010, the highest ever, up from $1.18 trillion at the beginning of the year. Given a standard earnings formula of 2 percent of total assets plus 20 percent of the increase, hedge fund bosses stood to collect roughly $186 billion in personal income. An 80 percent tax on that income—less than the percentage rate on multimillionaires levied under the Eisenhower administration—would produce more than enough revenue to put all 50 states in the black. (It should be pointed out that the top hedge fund manager, John Paulson, had a personal net profit of more than $5 billion in 2010, while more than a dozen hedge fund bosses had personal incomes above $2 billion and many more took in over $1 billion).  (Thanx to Patrick Martin)

There you are….none of those will make the rich happy or for that matter any corporation, especially those that are sitting on their cash watching the country circle the drain……but I keep hearing from Washington that we all must make the sacrifice for the good of the country and would not that include those that are making a killing on the backs of the middle class?

Does anyone truly believe that cuts to NPR, WIC or any of the hundreds of nickle and dime programs will help balance the budget?  So far the only sacrifice that is being made is that of the middle class and those living in poverty…….nothing asked of the wealthy or the corporations…..so basically they are saying that it is up to the working class to balance the budget and cure the spending woes…..(I know you cannot see it…but trust me…I am smiling my “told you so” smile)…….

The GOP’s Man Crush

By now we ALL have heard about the doings in states like Wisconsin, Indiana, Ohio, to mention a few……if not then there is a rush by GOP governors to attack public employees and their unions….it seems to these types all the budget problems and shortfalls are ALL the fault of public employees and the unions……It seems that the GOP is still trying to negate ALL progress of workers that started back in the 1940’s………..conservs make it sound as if the public employees have somehow stolen their benefits….utter and total BS!

I am still waiting for these governors to focus on one of their major points that helped them win a large percentage of the vote….that point is…the creation of jobs…..somehow lower corporate taxes will create jobs….it has NOT in my state, which has some of the lowest in the country, and have been promised great prosperity will come with lower taxes….not so in the last 50 years…..nowhere have these elected officials created a job and their points they are pushing like furloughs, dismissals, etc….will create NO jobs  but will create a rise in unemployment….keep in mind you mental midgets voted for these people….are you pleased with your choices?

Anyway back to the man crush thing…….The darling of ALL conservs, Gov. Cristie of New Jersey today on MSNBC (which has a major man crush on this guy)…..Christie talked about the stuff he is doing in New Jersey he said that….”the unions were destroying thew Middle Class and that by pursuing them he was going to strengthen the Middle Class….(this is a paraphrase)……and of course Morning Joe was so9 pleased to hear that the public employees would be attacked that he could barely contain himself (after all he is a conserv and as such sees the evils behind unions)…….but after hearing his little mindless diatribe I have to ask……..

Just how are unions destroying the middle class, governor?  How would weakening or eliminating unions strengthen the middle class?

Since thanx to the work of unions, the middle class prospered and gave working people the opportunity to advance their standing in society…Thanx to the work of unions Americans were given the chance to live the American dream…Just how would Christie and his comrades strengthen the middle class?

These GOP governors are pursuing an agenda that they kept from the voter during the campaign….this is NOT unusual….but you would think that the American voter would be smarter by now……(pause here for raucous laughter)…….

You Want Cuts? Where?

We have heard all the back and forth on the subject of spending cuts……..the GOP had two main promises that propelled them to the top….Jobs and spending cuts……so far they have produced about ZERO jobs and they have started their attacks on spending…….but where do they start this attack…….where do the people think the cuts should start?

NO one has an idea……they said in a recent poll that were should start with foreign aid…the problem there is that the aid makes up about 1% of the total spending so that will NOT be a big help…..so what is the beginning of the attack on spending?

Good question…..and the GOP has an answer for you…….

http://t.co/VoYjTFL.

Really good ideas……NOT!  Cuts come from social services, energy and hi speed rail, law enforcement, development projects…..to the tune of about $50 billion……a lot of cash, eh?  Well in the scheme of things it is a pimple on an elephant’s ass……that is right……chump change!  Does NOTHING to cut the spending but everything to do with the continuing attacks on the middle class and working poor…..the position that the GOP is ALWAYS in…….

Nothing the GOP is proposing will do anything to balance a budget……you asked for it and now you have it……by voting for the GOP in the last election you have condemned many people to a more miserable life than they have…..and quite possibly have even condemned yourself….typical of American voters…..always voting against their best interests…….

Brings to mind one of my fav quotes…”Stupidity is the deliberate cultivation of ignorance”….American voter in a nutshell!

 

Happy Birthday, Ronnie!

College of Political Knowledge

Subject:  Presidents

NOTE:  I apologize for the delay of this post…it was meant to be done on 06 Feb on Reagan’s actual birthday……a cold and a fever have been more than my fingers could take……

We are in the midst of celebrating the 100th anniversary of the birth of Ronald Reagan, the 40th president of the US, that god-like hero of the Right….conservs bow and pray (or should that be prey)  at the feet of the giant in American conservatism…..

Let us be real for just a damn moment!  The Left (if you will) has its deified leaders……FDR, Kennedy and Clinton….you know those past presidents that did some things right and the country seem to respond well to them….and thus they become rallying calls for subsequent elections…..and what has the Right had to use?  Goldwater? Hoover?  Nope!  The only thing that they have had in the past 70+ years is …..Reagan.  And they have used it for all it is worth…….every recent GOP nominee has tried to use the mantle of the heir to Reaganism.

I will give Reagan his props…..I believe that he was instrumental in the ending of the Cold War (a debatable premise)  and the demise of the USSR….he helped redefine the conservatism as we know it today and he changed economics ………not that I consider anything good…..the trickle down theory that is still used today and still does NOT work……

If the very name makes you wish for better days then you need to go back and try again….Reagan supposedly stood for lower taxes, deficit reduction and smaller government….you know all the crap that Repubs still cling to but still cannot seem to find the right handle to open that door.

In reality, Reagan could not find the handle either….for all his bolster and vocalization….he could NOT keep the three simple rules of the GOP…..he increased taxes 6 out of the 8 years he was president……he increased the deficit at least two fold and he grew the size of government….

Does lower taxes, smaller government or deficit reduction sound at all familiar?  Well it should!  You have been promised that by every GOP president for the last many years….Bush I, Bush II, and every candidate for as many years…..and whenever they control Congress they have been unable to keep the promises and in most cases did the opposite….and yet YOU keep voting for the idea that cannot be upheld…..at least NOT in our way of governing…..

The GOP cannot keep their promises and have seldom kept the promises of smaller government, lower taxes or deficit reduction and yet they cling to the past and the crap of the past……Repubs need to find a new tune….this song remains the same…..

People!  Stop deifying these people…they do NOT deserve such an honor!  Every president is a special person, in their own right, but NOT one needs to be deified…….when the electorate finds that person that can solve the problems and still treat the people, all the people, with respect to their needs, then, only then…..should deification be considered!

Why Not Tax And Spend?

I hate to break it to all you conservs and TPers….that is what governments do…they tax and then spend their revenues to benefit society….well that is the plan, but unfortunately does not always work out that way….the politicians find creative ways to waste the revenue….like un-winnable wars, for one….

But there needs to be a better way of tax and spend…and it could possibly be a shot to the arm of the deficit….

This a proposal from the Center For American Progress……

  • Thus the need for revenue. In this report we offer revenue-generating plans that will hit four deficit-reduction targets: 33 percent of the way to primary balance in 2015, then 50 percent, 67 percent, and 100 percent. The most far-reaching of the revenue plans, the 100 percent tax revenue option, relies on seven distinct tax increases. This plan would generate $255 billion in new revenue by: Implementing a graduated surtax on adjusted gross income for households making more than half a million dollars per year
  • Imposing a $10 per barrel fee on imported oil
  • Returning the estate tax to pre-Bush tax cut levels—a $1 million exemption and a 55-percent rate
  • Removing the cap on the employer side of the Social Security payroll tax
  • Indexing the entire tax code to a better measure of inflation
  • Increasing the top rate on capital gains and dividends
  • Increasing the ordinary income tax rates on tax brackets between $140,000 and $380,000

Any deficit reduction plan is a balancing act between spending cuts, tax increases, the needs of the nation, and the wide range of views on which of these are most important. This report offers five different balances for getting to the 2015 target of primary balance. We believe the 50-50 plan, accompanied by a crusade to deliver government services more efficiently and effectively, offers the best option.

So tax and spend may be dirty words to conservs, but it is the way of government…like it or not…..

Okay, let us look at the states…..conserv commentators say that the reason industry left this area was because taxes are too high…..places like New York, Connecticut, etc….if that is the case why is not the South more industrial…you cannot find lower business taxes than in Mississippi and Alabama?  Answer us this!

We all want and need services provided by the government, like police, fire, education, homeland security, etc, but in this atmosphere of “smaller” government how do we find the cash to fund these services?  The answer!  VAT!

A VAT is like a sales tax in that ultimately only the end consumer is taxed. It differs from the sales tax in that, with the latter, the tax is collected and remitted to the government only once, at the point of purchase by the end consumer. With the VAT, collections, remittances to the government, and credits for taxes already paid occur each time a business in the supply chain purchases products from another business.

This could be sold to the corporations and businesses…..why?  They could recoup some of their taxes while the ultimate consumer, you and me, are screwed on getting any of the taxes back…this should make the conservs happy…this is a better plan than some of the others offered out there…..why not try….we might find the cash to actually have a country that lives within its means…….

Are You Smarter Than The Average Politician?

For months on months we have been bombarded with the realization that the Federal deficit is getting out of control….we are told that we need to kill health care or the at we need to tax more or that we need the Tea Party or the Dems or even the GOP to fix these problems….we have been told all the problems, some imaginary some not so, but the point is that we have been told all about the problems……cool huh?  But have you heard one of these people tell you how they would repair our spending spree?

I do not mind the spotlighting of the problems, as some see them, but I do dislike the fact that NONE have an idea….they must check with their party apparatus to decide what they would do….NONE have an original idea….

I would like to thank our friends over at “Why We Worry” (go to blogroll and visit a very good sight) for turning us onto this……

The NY Times has an article about how YOU can fix the deficit…..take your ideas and plug them into the questionnaire and see if you have what it takes to fix the deficit and make America strong again…..it will take about 10 minutes, if you do not read without moving your lips, maybe a little longer…..but see if you are as smart as a politician….

– NYTimes.com nytimes.com/2010/11/21/wee…

Below is my solutions……and I did pretty well at lowering the deficit…..

nytimes.com/interactive/20…

The problem is that I made choices that will benefit the country not my re-election campaign……

So what were your choices and why?

Alternative Deficit Reduction Plan

Just a week or so ago there was a draft of a plan by the Deficit Reduction Commission…. (or something like that)…..and with the release came the oh craps from Repubs as well as Dem…they hate this issue or that cut…..most notably it was the cuts and tweaks of the Social Security system that got the most attention…personally, I found parts of the draft very doable and well thought out….but that aside there has been a wealth of bitching and finally we have an alternative to the draft……

Rep. Jan Schakowsky (D-IL), a member of the bipartisan National Commission on Fiscal Responsibility and Reform, offered a comprehensive proposal to reduce the federal deficit without making middle class Americans foot the bill.  Schakowsky’s plan is an alternative to the Bowles-Simpson plan and would reduce the deficit by $426.95 billion in 2015, surpassing President Obama’s $250 billion target. Critically, the Schakowsky plan accomplishes deficit reduction without making cuts to essential federal expenditures that benefit the middle class.

The Schakowsky plan is based on five key elements:

1) Increased economic stimulus to spur growth in the immediate term

· Provide $200 billion to invest over the next two years in measures to create jobs and spur economic growth, including passing the Local Jobs for America Act; and funding for education and law enforcement; Unemployment Insurance, Federal Medical Assistance Percentages (FMAP) and Supplemental Nutrition Assistance Program extensions; and infrastructure. 

· Adopt the President’s proposals to eliminate overseas tax havens and incentives for outsourcing

2) Smart, targeted spending cuts

· Non-Defense Discretionary – $7.55 billion in savings through increased efficiency and cuts to programs that benefit large corporations that don’t need assistance.

· Defense Discretionary – $110.7 billion in cuts from the 2015 defense budget, including efficiency savings, reducing our troop levels, cutting weapons systems we don’t need, and scaling back the wartime increases in the size of the military.

3) Mandatory spending cuts

  • Health Care – at least $17.2 billion in savings by implementing measures to bring down the cost of health care to the federal government and lower health care inflation overall.
  • Other – $7.7 billion in savings by cutting agriculture subsidies in half, and redistributing federal support to offer greater benefits to small family farms reduce subsidies to large corporate agribusiness.

4) Reductions in tax expenditures

  • Raise $132.2 billion by closing tax subsidies for companies that ship American jobs overseas.

5) Increases in revenues

  • Raise $144.6 billion in revenue through progressive reforms to the estate tax, treating capital gains and dividends as regular income, and enacting a cap and trade proposal that includes protections for lower-income people.
  • Enact President Obama’s budget proposal to let the Bush tax cuts for the top 2 brackets expire and return to 2009 estate tax levels.
  • Non-tax revenue – raise $7 billion by addressing places where the private sector is currently under-paying.

The Schakowsky alternative does not contain any cuts to Social Security.

  • It ensures long-term solvency to Social Security by eliminating the wage cap on the employer side and raising it to 90% on the employee side, applying FICA to all wage income below the cap, and establishing a modest legacy tax on wealthier Americans.
  • Surplus funding that can be used to improve the extremely-modest benefits that are now provided.

All the above from the Representative’s website….

There you have it…an alternative and the sanctity of Social Security is preserved…..Is there any thoughts on this proposal….will it help make the liberals happy….if it does then the conservs will be pissed…..but again it is a start and could be a starting place for compromise…..IMO, not as good as the draft released last week….a little to non-specific……

It Is Only A Draft!

First of all–calm down!  It is NOT official…not yet……

By now most Americans have heard all the hullabaloo (the debate not the dance party) over the draft proposals coming out of the Deficit Reduction Commission….right?  The Progressives are up in arms over the proposals for Social Security and Medicare…..the conservs are pretty quiet right now…other than saying the report is a pretty good one when it comes to entitlements…..Reuters seems to have the best analysis of this report…..(since not too many readers actually click onto the links…I have put the meat of the report here for everyone to look at and decide)…….most media outlets are emphasizing that points that they have a problem with……none seem to want the whole draft proposal to be viewed……. so I thought I would try to crap on their parade……

SPENDING CUTS

– Would reduce discretionary spending (programs like defense and law enforcement that are set by Congress each year) in fiscal 2012 to 2010 levels; impose 1 percent cuts in each of the next three fiscal years

– In 2015, defense spending would be $100 billion lower and nondefense spending also $100 billion lower than envisioned in the White House’s current budget scenario

– Eventually bring government spending down to 21 percent of gross domestic product, from its current level of 24 percent of the economy

– Automatic cuts would take effect at the end of each year if Congress exceeds spending caps

– Set up bipartisan committee to eliminate outdated and inefficient programs

– Stretch out budget cycle over two years

– Sample cuts include: freeze pay for federal workers; reduce overseas military bases by one-third; cut federal workforce by 10 percent; slow growth of foreign aid

OVERHAUL TAX CODE

– Would eliminate all of the $1.1 trillion exemptions currently in the tax code, such as the mortgage-interest deduction and the earned-income tax credit

– Lower and simplify individual income-tax rates: 8 percent for those with annual incomes below $70,000; 14 percent for those with incomes up to $210,000; and 23 percent for incomes above that level

– Lower corporate tax rate from 35 percent to 26 percent

– Treat dividends and capital gains as ordinary income

– Set aside $80 billion for deficit reduction

– Gradually raise gas tax by 15 cents starting in 2013 to pay for transportation spending

– Abolish the alternative minimum tax

REDUCE HEALTH CARE COSTS

– Would pay doctors and other providers less for seeing patients under government programs like Medicare and Medicaid

– Cap damages in malpractice suits

– Require Medicare participants to pay more costs themselves

– Require lower costs for brand-name drugs covered by government programs

– Expand successful cost-containment programs

– Strengthen independent oversight board

– If costs grow more than 1 percent faster than the economy after 2020, require president to propose further cost cuts or a robust public health insurance option

OTHER SAVINGS

– Would reduce farm subsidies by $3 billion per year

– Revamp consumer price index, used to calculate benefit increases, to better reflect actual rate of inflation

– Increase employee contributions to government retirement programs

– Postpone military retirement programs and make them take effect after age 60

SOCIAL SECURITY

– Would revamp the retirement program to ensure its long-term stability, but separately from the deficit reduction effort

– Add minimum benefits for poorest retirees

– Increase benefits for older retirees

– Require more affluent earners to pay more

– Raise the retirement age to 68 in 2050 and 69 in 2075

– Exempt those who work physically demanding jobs; allow them to retire at 62

Thanx to Reuters for this….maybe American media should give it a try…..giving all the facts,  that is……….

Like I said the libs are tearing up the report for the entitlement stuff….but they need to remember that it is a draft and will take 14 or the 18 members to make it official….there will be changes and adjustments…..

To begin with I see where there could be a bit of bi-partisanship in this report….but it will mean give and take and stop all the BS….personally, I do not like the lower corporate tax, but if they are successful at changing ALL the tax code then I will go along with it (for the record, I have been calling for elimination deductions for 20 years and higher wager earners paying more into the SS program)….crappy programs…another good one…..

It is a start….and we need a starting place………if not …we got….NOTHING!