May 17th, 2011

Captain America Pensive

Debt and Taxes - The Atlantic

An interesting take from the left.  Each election cycle we delay making substantive changes in our budget makes the oncoming disaster worse.  I read an article by Mark Steyn a while back in which he raised the question as to why we even bother to have a debt ceiling...or why it isn't $14 gazillion dollars.  His point is that we argue about making small changes that reduce the rate of growth which is never going to get us going in the right direction.  The other problem we have is that if we instituted a program to balance the budget in say 10 years with mandated spending caps that took the budget from $1.7T now and capped it at say $1.53T next year and $1.36T the following year until in 10 years the budget was balanced.  Now, the big problem with that is that this assumes that the projections for revenue are correct (they never are)...but if you cap the spending, then you control that issue.  This would likely have to be offset with some way to increase revenue (yes raising taxes).  However, my suggestion would be to expand the rolls of the tax payers as opposed to trying to bleed the wealthy.  This can happen via a flat tax, or the fair tax (though I admit that is a pipe dream).  A flat tax with a poverty line cut off and no deductions would work (though its effect on the economy would be bad,especially in the home market).  But, in the end...we are all going to have to pay more and accept less if this is ever going to get turned around.  Oh...and I would also suggest that the gov't sell bonds for programs that they want to do above budgeted spending.  This would allow them to fund programs and people could buy bonds to make it happen.  Want to fund a space program...sell bonds.  Want to fund Iraq or Afghanistan...bonds.  Want a welfare program or student loans...bonds.  Let people pay for the services they think are necessary and reduce the gov't to the bare minimum...at least until we balance the budget and pay down some debt.
 
Either that or we should draft Dave Ramsey to be President.

Debt and Taxes - The Atlantic