Who will be upset by panel's proposal on national debt? Nearly everyone.
The co-chairs of Obama's deficit-reduction panel issued a proposal to reduce the national debt by $4 trillion in 10 years. But the budget cuts and tax increases promise to anger just about everyone.
(Page 2 of 2)
“What is really happening is cuts advocates are using the Social Security funds ... to reverse other federal programs that do have deficits or are unpaid [for], and to pay for the tax breaks for the wealthy,” said Robert Weiner, former chief of staff of the House Aging Committee.Skip to next paragraph
Subscribe Today to the Monitor
The proposal raises taxes, which the GOP in general, and tea party adherents in particular, might not like. Every three dollars in spending cuts would be matched by one dollar in revenue enhancements, according to Mr. Bowles and Mr. Simpson. The level of income to which the payroll tax applies would rise, for instance. Popular tax deductions, such as those for mortgage interest and state and local taxes, would be ended.
The gasoline tax would go up by 15 cents a gallon to fund transportation programs.
Generals. The military and defense contractors would face bleaker financial futures under the co-chairs' proposal. The armed forces are a large part of the US budget, and deficit reduction is difficult unless they share the pain, argue Bowles and Simpson. Illustrative suggested cuts include a 15 percent reduction in weapons procurement, a 10 percent reduction in research and development spending, and a three-year freeze on wages for Defense Department personnel.
Lawyers. The proposal includes promises of significant tort reform for medical malpractice cases as a way of lowering America’s health-care costs. This is something trial lawyers (and their largely Democratic political patrons) have resisted for years, saying it would deprive those truly harmed of a chance at redress in the legal system.
Farmers. Agriculture subsidies would be reduced by $3 billion annually under the proposal.
Students. Bowles and Simpson would eliminate in-school interest subsidies for student loans.
Bureaucrats. Government workers would have to pay in more towards their retirement plans under the co-chairs’ plan.
We could go on, but you probably get the picture. The possible pain is so widespread that it is unlikely Bowles and Simpson will get the nine other Democrats and seven other Republicans who serve as members of their panel to sign on to the plan as it is. If 14 of the 18 total commissioners agree, then the plan gets sent to Congress for a vote in December.
So who likes the plan? Washington’s corps of deficit hawks, that’s who.
The proposal “represents a commendable, comprehensive, aggressive and good-faith effort to address our nation’s structural deficit,” said David Walker, a former Comptroller General of the US who is now CEO of the Comeback America Initiative.