Fiscal commission co-chairmen Erskine Bowles and Alan Simpson have drafted a horribly unbalanced, and radical deficit reduction plan. The 18-member commission votes Friday, and if I were on it, I would vote “no.”
Among the worst ideas:
* That there is a proper government spending share of GDP, and that it is well below the figure that would be projected from a reasonable assessment of demographic trends.
* That it’s good policy to set mindless, arbitrary limits on "discretionary" spending, and that those limits should be far below present levels as a share of the economy.
* That Social Security benefits are too generous in an economy that is diminishing most other forms of retirement income.
* That the combination of Medicare and Social Security restrictions would be remotely reasonable for most elderly people, or rather, that the deficit requires making it much more likely that old people will go without medical care.
* That it makes more sense to end policies like the mortgage tax deduction and employer health exclusion, policies that are deeply embedded in our current economic system, than to allow the high-end Bush tax cuts to expire.
This plan is madness masquerading as responsibility. I am amazed that Simpson has any credibility considering some of the things he has said. Yesterday he said that the "majority" of the tax increases in their proposal would come from the top 1 percent of the income brackets. I don't have the figures, but that's one heck of a lot of houses and health insurance for a small group of people.
Joseph White is Director of the Center for Policy Studies at Case Western Reserve University.
Click here to visit the Capital Exchange home page.