The voices of Tax Policy Center's researchers and staff
Every morning I read essentially the same story in my newspaper– the national debt has hit the legal limit, and unless the debt ceiling is raised (or razed, as Jared Bernstein and TPC director Donald Marron advocate), the government could start defaulting on its obligations. Obligations that the Congress passed, I like to point out.
This morning’s version of the debate focused on adding in a bipartisan committee that would focus on debt reduction. Frankly, this seems like a lot of effort for a group of lawmakers who have had years to figure this thing out, and I’m more than a little skeptical.
So before we create this committee, I want to recommend a few gems worth reading. Who knows, maybe someone will realize that there’s already a solution just waiting on the shelf.
For starters, Congress might want to take a gander at the plan released last November by the Bipartisan Policy Center’s Debt Reduction Task Force, led by former Senator Pete Domenici and Alice Rivlin. Their plan would cut spending (54 percent of their solution), clean up the tax code by excising many of the preferences that have infected the code since Reagan and Rostenkowski cleared it out 25 years ago (38 percent), and pure tax increases (9 percent). By 2020, those steps would reduce and stabilize the national debt below 60 percent of gross domestic product (GDP).
If that plan’s too tough for you, Congress could consider the December report from the White House’s National Commission on Fiscal Responsibility and Reform, headed by Erskine Bowles and Senator Alan Simpson. The preamble to that report noted that “everything must be on the table” when in the search for solutions to the budget problem. Compared with BPC’s proposal, the commission’s final plan would rely much more on cutting spending (77 percent) and less on tax reform (18 percent) and pure tax increases (5 percent). Recognize a pattern?
Both plans insisted on decreasing spending, reforming taxes, and adding on additional revenues. So why don’t you start there, Congress? Last week, Grover Norquist let slip that letting the Bush tax cuts expire wouldn’t violate that “no tax pledge” a lot of you signed. Although Norquist has tried hard to get that horse back in the barn, it sure looks like you’ve got an opportunity here to both stick with your pledge and have revenues play a role in this debate. I recommend you take it – at least with respect to the high-income provisions.
It’s not too late to stop playing politics with the American economy and act responsibly. Take a good, long look at those sensible options and do right by the folks who sent you to Washington.
Posts and comments are solely the opinion of the author and not that of the Tax Policy Center, Urban Institute, or Brookings Institution.