I think most people who live in the real world (leaving out the gutless wonders who inhabit Washington, D.C.) will agree that if we ever hope to get our fiscal house in order some tough choices will have to be made. David Pauly has a piece at Bloomberg today with 9 suggestions:
1) Restore all income taxes to the pre-President George W. Bush level, not just those for people earning $250,000 or more.
2) Tax the banks $90 billion as proposed by President Barack Obama to pay for their bailout. Then break them up -- making them small enough to fail and eliminating the need for more trillion-dollar rescues.
3) Eliminate income-tax deductions for property taxes and mortgage interest. Phase it in over five years so it hurts less.
4) Break Fannie Mae and Freddie Mac into four mortgage- buying companies and get them off the federal dole.
5) Raise the retirement age for collecting full Social Security benefits to 72. Cut cost-of-living increases for beneficiaries to half the inflation rate for 10 years.
6) Raise the age for Medicare eligibility to 68.
Regarding numbers 5) and 6): Keep in mind that when Social Security was passed in 1936, life expectancy was 62. When Medicare was passed in 1965 it was 70. Today it's 78.
7) End the wars in Iraq and Afghanistan on the current schedules.
8) Kill farm subsidies.
9) Reduce government.
Pauly lists some of the overlapping agencies and departments which could eliminated:
[Does] the president really needs both a Council of Economic Advisers and a National Economic Council?
Government housing officials will have less to do if we cut Fannie and Freddie loose.
Whole agencies might be suspect. We, for instance, have a Selective Service System but no draft.
The government has both the U.S. Postal Service and the Postal Regulatory Commission. Doesn't competition from e-mail and FedEx Corp. keep postal rates in line?
Certainly food for thought. What say you?
1) Restore all income taxes to the pre-President George W. Bush level, not just those for people earning $250,000 or more.
2) Tax the banks $90 billion as proposed by President Barack Obama to pay for their bailout. Then break them up -- making them small enough to fail and eliminating the need for more trillion-dollar rescues.
3) Eliminate income-tax deductions for property taxes and mortgage interest. Phase it in over five years so it hurts less.
4) Break Fannie Mae and Freddie Mac into four mortgage- buying companies and get them off the federal dole.
5) Raise the retirement age for collecting full Social Security benefits to 72. Cut cost-of-living increases for beneficiaries to half the inflation rate for 10 years.
6) Raise the age for Medicare eligibility to 68.
Regarding numbers 5) and 6): Keep in mind that when Social Security was passed in 1936, life expectancy was 62. When Medicare was passed in 1965 it was 70. Today it's 78.
7) End the wars in Iraq and Afghanistan on the current schedules.
8) Kill farm subsidies.
9) Reduce government.
Pauly lists some of the overlapping agencies and departments which could eliminated:
[Does] the president really needs both a Council of Economic Advisers and a National Economic Council?
Government housing officials will have less to do if we cut Fannie and Freddie loose.
Whole agencies might be suspect. We, for instance, have a Selective Service System but no draft.
The government has both the U.S. Postal Service and the Postal Regulatory Commission. Doesn't competition from e-mail and FedEx Corp. keep postal rates in line?
Certainly food for thought. What say you?
The only ones I woud have a real problem with are 5 (raising the full Soc. Sec. age to 72) and No. 6 (raising Medicare to 68)although I'm older than that. It's difficult to get and keep a decent job after 55. When I was 55, all of my friends in the same age bracket had been laid off from good jobs. I had to purchase insurance from age 60 to 65, and it was $500/month six years ago with no pre-existing problems. I can't imagine what it would be now for someone 65 to 67. With respect to No. 8, limit subsidies to small farmers. When one hears of subsidy amounts with 6 zeros, it is upsetting.
I would add a No. 10, to reduce the items corporations and businesses can deduct as expenses. Limit the amount of the high salaries that can be written off and the number of automobiles. I've worked for two large companies, both of which spent a great deal of money figuring out how to avoid taxes. I also know of a little family-owned restaurant where they have more vehicles with signs than they have seats in the restaurant.
They should completely rewrite the Tax Code, but we'll probably not live to see it.
BTW, (1) and (4), I really like 1 and 4.
As far as wars. I have an idea I'd like to run up the flagpole.
Before we invade anybody, AGAIN, let's compute how much THAT is will likely cost. THEN, we offer the "target" nation 30% of THAT money to just quit doing what they're doin' that's pissing us off. Example, bring Ahmadinejad over here, take him to a Capitals hockey game. Get him a souvenir puck.
Bombing Iran likely gonna cost what,$700-800 billion easy. Offer HIM $180 BILLION to halt his nucleur weapons program. Now, I know that's nothing like what an AIG executive gets, but in Iran, that's nothing to spit at. "Dollar Diplomacy", It's not like I made that up myself.
I don't have a cushy pension to fall back on. I NEED my social security. Cut it back 10-12%, I can proibably get by. But, IF there isn't enough money to pay us baby-boomers, just print more.
Now, as far as MY living beyond age 62-65. My doctor says I have been doing ALL I can to assure that I don't live that long. Potato chips, Jack-in-the Box tacos, mayonnasie on everything, you get my drift. And to my (dis)credit, I have heart disease, coronary artery disease, diabetes, high blood pressure, am 30 pounds overweight, and get as litle exercise as possible. As Charles Barkley says, "I'd run but I get tired. I'd lift weights, but they're really heavy."
My uncles are in worse shape than I am and they're 75 and 78 respectively. LOngevity.....don't blame me and my famly, blame those damn pharmaceutical companies. The longer they keep us alive, the more medicine we have to buy from them. Devious BASTARDS. Gotta go, my ribs and french fries are here from Pappas Barbecue. :-)
You are too late for social Security, it's already broke, paying out more than it collects.
Unless the SS tax is increased, again, it will never be able to pay out, and there is no where to collect what was stolen from it. It isn't coming back, ever.
Actually, skimming the excess in SS payments for several decades was all that ever really kept the Fed solvent.
Peter Orzag while at CBO and now the Office of Management and Budget, denied this day was coming for the last 3 years. David Walker has been warning about it for the past 10 yrs. Fix it now, Petey.
http://finance.yahoo.com/focus-retirement/article/108747/next-in-line-for-a-bailout-social-security?mod=fidelity-readytoretire
#5, I think people might get the idea they were being stolen from if money was being taken out of their check every year and they stood a good chance of being dead before theyt ever got any of it back. #8, I think it should be reevaluated as opposed to done away with. Like Stex said, some years are tough for farmers. Perhaps doing away with the negative subsidies is a good idea. Paying people to not plant might have made sense at one time but the only person I know that is receiving those now wouldn't be planting anything there anyway.
As an example of how hard it is to be a farmer, my brother-in-law called the other day:
"Sure is gettin' tough bein' a farmer these days. Not only do you have to remember which crop you're NOT plantin'. You gotta remember which field you're NOT plantin it in."
Sounds good to me. You are on the right track, as usual. Just a few "exceptions".
(5) and (6) Exempt people born in March 1951 and their friends (I'm thinking about you bro')
(8) Farmers have a tough job. I know. My wife's family are farmers. Just don't give farm subsidies to HUGE corporations like ADM. If they can't make money doin' something they shouldn't be doin' it.
(9) Layoff anybody who can't accurately describe, IN DETAIL, WHAT he/she does for the government.
TWO additions, everybody who works for the government BELOW the president and the vice-president, can drive their OWN lazy ass to work in their own vehicle. No more chaffeurs and free rides to work for the Acting, deputy, under-secretary to the assitant director for energy generation from recycled Canadian hockey pucks.
Elimiate Army, Air Force and Navy military "fly overs" at NASCAR races and ALL football games. That should save about $2-4 Billion over the next 10 years in gas alone.
1, 2 okay.
3 - feels personal and would be a hardship for me.
Using tax policy to set social policy is a long tradition in our country. If we no longer have a goal of helping citizens become home owners, just say so. Me, I'd rather set a basic tax level for corporations, no matter how good they are at paying no taxes at all.
4 - I really don't know what that means.
5 - 72, eh? just how much do you think individuals owe corporations? apparently years more. I protest and say no.
6 - as someone who is about to be laid off, too young for medicare, and with the dratted pre-existing conditions, this feels bad, too. I protest and say no.
7 - or sooner
8 - only to corporate farms; I'd continue them for family farms; right now, we subsidize the production of corn and soy that ends up in processed foods, making them cheaper than real food like carrots, melons, etc. Makes no sense.
9 - okay
10 - stop defense projects that nobody in the military wants or needs; they're identified on a regular basis and kept in the name of jobs.
I have to say, items like this were easier to think about in the abstract when I was younger.
Between then and now, life happened to me -- and in my peak earning years, to boot.
I'm all for 1,2,4,7 and 9. 9 in particular. 6 would be a sound fiscal idea. 5, in particular the COLA idea would be a killer for an awful lot of people. 3 would be doable, but I don't know what the impact would be on individuals. What do those deduction mean to the average taxpayer ? 8 is probably a pretty bad idea. Most farmers I have know have some pretty bad years n between the fairly good years. Too many variables affect them. Weather, etc. Things they can't control.