Group Offers Way to Wipe Out the Deficit
STRIP away the politics and the emotions, and balancing the budget becomes a simple rearrangement of numbers -- maybe.Skip to next paragraph
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To prove it could be done, the Concord Coalition, a bipartisan Washington-based membership organization headed by former Sens. Paul Tsongas (D) of Massachusetts and Warren Rudman (R) of New Hampshire, has produced a plan for wiping out the deficit by century's end.
With the deficit in 2000 now expected to be $251 billion, the authors sharpened their pencils and started subtracting.
The biggest cut -- $118 billion -- comes in entitlements, the package of government payments to individuals that includes Social Security, Medicare, and unemployment benefits.
Questing for savings, the plan proposes cutting or reducing 37 programs and 13 ''subsidies to narrow interests.'' That would trim $19 billion.
Cutting the proposed defense budget for 2000 of $269 billion by $5 billion would still enable the US to fight two large regional wars simultaneously, the report says. The plan does allow for $10 billion in high-priority investment spending -- likely technology-oriented -- to replace the cut progams. Another $2 billion would come from foreign aid.
Taxes could raise $71 billion. A phased-in 50-cent-per-gallon gas tax would provide $44 billion in revenues while still keeping gas prices below those of the 1970s. ''Sin taxes'' would quadruple today's 24-cent-per-pack cigarette tax and raise the tax on a bottle of wine by 40 cents.
To reach the grand total, national-debt interest payments could be trimmed by $35 billion -- borrowing less to pay for the deficit would decrease annual interest payments, the authors assert.