• Cut More Spending!

      A draft from the Congressional Deficit Commission that Obama appointed came out today, and it actually has a lot to like. For instance:

      -- Raising the retirement age to 68 [which] would be implemented by 2050 and then would increase again to 69 by 2075…

      -- reducing the base rate on corporate taxes…

      -- reducing foreign aid by $4.6 billion…

      -- freezing federal salaries for three years…

      -- eliminating popular tax breaks, such as mortgage interest deduction…

      -- cuts in farm subsidies [by 3 billion/year]…

      -- cuts in the Pentagon's budget [by 200 billion/year]…

      That sounds like a lot of spending cuts – and it would be a good start – but it’s still not nearly enough to get around Medicare’s $38 trillion unfunded liability.

      So the Deficit Commission also proposes tax increases. The group Americans for Tax Reform notes:

      The report calls for a ten-year net tax hike of $961 billion, nearly a $1 trillion tax increase over the decade.

      The stated goal of the report is to raise the long-standing historical level of federal revenues from its average of 18 percent of GDP to 21 percent of GDP…

      Oops.  Why isn’t 18% more than enough?  Because there is still so much waste in federal budgets.

      The gas tax would be raised by $0.15 per gallon beginning in 2013. All this money would be spent on union-dominated “Davis Bacon” construction projects...

      Yet even these insufficient cuts are likely to go nowhere. Rep. Jan Schakowsky, D-Ill, is already on the record: "This is not a proposal I could support …On Medicare and Social Security in particular.”

      The report’s authors know their sensible plans are unpopular. A Debt Commission co-chair who wrote the leaked proposal joked to reporters that he would now head to the “witness protection program."

      So what can we do? Economist David Henderson notes that Canada has reduced its deficit by cutting spending --  without increasing taxes.

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