Out There

the broad solution to the debt ceiling budget shortfall groundhog day crisis!

Posted in Uncategorized by Pete on November 20, 2013

Every few months we all get treated to another round of debt ceiling freakouts by our elected leaders.  When “…the question on everyone’s lips (their chapped lips!) is:” will we default and plunge off some sort of metaphorical cliff like Phil and the groundhog (Don’t drive angry!), or will they make a deal?  A compromise.  A deal like the one proposed by Simpson & Bowles way back in 2010, which enjoyed a modicum of bipartisan support, but apparently not enough to make legislation actually happen.

A story from last month that appeared shortly after the last edge-of-the-cliff temporary agreement is here.  Its a good primer on the recent history of the debt ceiling problem, and gives a depressing commentary on how far the 2 parties are apart on the issue.  So I figured that what the country needs is for a random blogger with zero readers or influence to come up with a plan to fix things, ha ha.  But surely this isn’t that difficult.  The problem seems to be much more about pride and influence and self interest than it is about the actual logistics or the complexity of the problem itself.  As opposed to, say, the problem of systemic, generational poverty.  So without further ado, here is Pete’s super-easy fix to the debt ceiling / budget deficit issue, aka the “make everyone crazy” plan.

First you raise all taxes across the board by 5%.  Note for you non-mathy types, this doesn’t mean you go from a bracket of 15% to 20%.  It would be from 15% to 15.75%.  Or from 20% to 21%.  Or 30% to 31.5%.  This will whip the conservatives into a white-hot, burn him in effigy, I-can-only-put-this-in-writing-because-I-live-in-far-away-western-Alaska-where-there-is-no-conservative-talk-radio, apoplectic rage.  Then you serve up a slice of budget cuts, a 10% cut across the board, from every department and program without discrimination.  No wrangling over which ones lose how much money.  Easy peasy.  This is the part where those of a liberal bent are reduced to seething, incoherent gibberish as they blow their top, hit the roof, lose their chips, insert your favorite cliche here, etc etc.  OK.  Now who haven’t we upset?  Just to be sure to get everyone involved, we top this meal off by raising the retirement age to 66 for everyone who is currently between the ages of 36 and 50, 67 for those ages 20 to 35, and 68 for everyone who is under 20.  This by itself would go a long way toward preserving social security solvency.  #4 is to eliminate the mortgage interest deduction on mortgages that exceed $1M.  This obviously wouldn’t affect most Americans, and wouldn’t make that much economic difference but I just had to include it as a nod to the fine people and classic podcast at Planet Money.  That’s it!  Four bullet points (in paragraph form!).  Now was that so difficult?  Of course you can quibble with the numbers.  Maybe its a 4% tax increase and 8% budget cut, whatever, you get the basic idea.

We’ve tried to find something that makes everyone happy.  We’ve tried for years.  It hasn’t worked.  So if it makes everyone mad…can’t that be fair too?  I had this revelation several years ago when Alaska endured the Frank Murkowski regime (a far bleaker time in Alaska politics, I feel, than when Sarah Palin was govnuh), when the state house and senate in Juneau were led by the most absurdly, SNL-esque over-the-top partisan leaders.  Millionaire banker Murkowski proposed helping to balance the budget via the POMV, which was maybe sort of a gateway drug to raiding the PFD, which would amount to a massively regressive tax on the poor.  Opponent Fran Ulmer proposed an income tax, but only if the state savings account fell to a certain predetermined level.  Murkowski called for the “Council of Alaskans” to decide, and nothing was decided.  Then it occurred to me that if everyone hates it, its probably fair!  Don’t do the GOP plan.  Don’t do the democrat plan.  Do both.  In this case you might even end up with a surplus and reduce the national debt.

Yes I know, it could never happen, this is a democracy where people need to get elected (and re-elected), blah blah blah.  Impossible in today’s polarized political climate.  Maybe tomorrow, but not today.

Take it away Phil.  “Well what if there is no tomorrow?!?  There wasn’t one today!”

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