Beating Back Our National Debt [Cut the Budget, Bleed the Debt]

Center for Fiscal Accountability ^ | 2011-05-05 | Mattie Corrao

[92nina]

After compelling the President to axe almost $80 billion from his desired spending levels for the fiscal year, House Republicans are once again faced with the prospect of negotiating with a recalcitrant President on the next spending battle: the approaching debt ceiling. In keeping with his inflated rhetoric on the threat of a government shutdown, President Obama is feigning exigency once again, claiming a “clean” debt limit vote is necessary to prevent government default and certain economic catastrophe.

The request to increase the debt limit without confronting the actual causes of debt belies the wisdom of having a debt ceiling – limiting the government’s borrowing authority is supposed to inspire prudence, not offer opportunity to flout it. What’s more, a “clean” debt limit vote would be somewhat anachronistic; the limit has been raised ten times in as many years with significant reforms attached, such as passage of the Congressional Review Act in 1996 and the Gramm-Rudman-Hollings budget reforms in 1985.

With the headroom on the $14.3 trillion debt ceiling closing in, Republicans have offered several proposals that would address the government’s overspending problem that drives the mounting debt. A balanced budget amendment to the constitution is one suggestion, as are serious statutory spending caps. However, the enormity of the government’s overspending problem requires additional and serious reform, addressing the seemingly insoluble spiral of entitlement spending and rectifying the government’s bias to abuse, rather than save, taxpayer dollars. The current political environment does not lend itself to reform that fully rectifies these problems...

[92nina]

Not sure if I agree with the tactic of several votes on debt. (Imagine the commercial about how "Rep. so-and-so vote five times" or such to raise the debt ceiling.) But one thing is clear, for even one vote on the debt ceiling, the GOP must not give away the store.t

Take this article and others I found to the fight to the Libs on their own turf; put the Left on the defensive at at Digg and at reddit and in Delicious and Stumbleupon

[kabar]

Unless you change the entitlement programs, you will never get our budget in balance. In fact, the entitlement programs will eat up the entire budget. Right now they consume 43% of the federal budget.

[bopdowah]

Try yur hand at cutting the budget:

http://youcutthebudget.com/

[Venturer]

80 Billion dollars was not cut from the budget. That was a farce.

[Extremely Extreme Extremist]

Unless you change the entitlement programs, you will never get our budget in balance.

I disagree. 2 things wrong with this statement:

(1) The public is too dependent upon them and will never accept changes (thanks to Republicans who can't control the narrative)

(2) The problem isn't the entitlement programs themselves; it's how they're unfunded and administered.

The key is to first foster economic growth. Get rid of payroll and FICA taxes and lower the overall rate to a flat 15% for everyone. That forces the leeches to find a job.

Then you go after things like the Education Department, HUD, Energy, National Endowment of the Arts....all these should be abolished.

The revenues can fund entitlements for existing seniors. Younger workers should be allowed to completely opt out of the system. The entitlements phase themselves out over time.

[kabar]

The public is too dependent upon them and will never accept changes (thanks to Republicans who can't control the narrative)

If no changes are made, they will consume the entire budget. They are unsustainable as currently structured. By 2030, one in five residents of this country will be 65 or older, twice what it is now. In 1950 there were 16 workers for every retiree; today there are 3.3; and by 2030 there will be two workers for every retiree. The entitlement programs represent an unfunded liability of over $60 trillion over a 75 year period. Our current GDP is $14 trillion.

The problem isn't the entitlement programs themselves; it's how they're unfunded and administered

Of course the entitlement programs are the problem as currently structured. Costs are going up faster than revenue. We have an aging population that will place even greater demands on the system. And the benefits are not tied to the revenue. They are on automatic pilot.

The key is to first foster economic growth. Get rid of payroll and FICA taxes and lower the overall rate to a flat 15% for everyone. That forces the leeches to find a job.

If there are no jobs, then you just add to the welfare rolls. Lowering taxes will not, in and of themselves, solve our long term budget problem. Unless you reform the entitlement programs, it will be impossible to balance our budget.

Then you go after things like the Education Department, HUD, Energy, National Endowment of the Arts....all these should be abolished.

They are just a drop in the bucket in terms of solving our problem. In 2010 our federal revenues from all sources was about $2.2 trillion, which is just about the amount we spend on the entitlement programs and debt servicing costs--about half of the federal budget expenditures. In 2010 we spent $3.5 trillion. The various agencies you mention are part of the discretionary budget, which makes up 19% of total federal expenditures.

The reality is that the entitlement programs will bankrupt us. Our current revenue is only enough to cover the entitlement programs and debt servicing costs. And the costs of the entitlement programs will increase as the population ages. 10,000 people are retiring daily and will continue to do so over the next 20 years. The tax revenue from the payroll tax, which amounts to 15.3% (12.4% OASDI on the current salary cap of $106,000 and ) 2.9% HI with no salary cap)amounts to 40% of total revenue. If you propose eliminating payroll taxes, you will need to come up with a funding source for that 40% and more as we go forward when more people are added to the rolls.

The revenues can fund entitlements for existing seniors. Younger workers should be allowed to completely opt out of the system. The entitlements phase themselves out over time.

Not even close. And I thought you said that people would accept no changes in the exisiting entitlement programs. If younger people opt out, there will be a revenue problem to continue funding existing benefits for the growing aged population. I don't see how you can raise enough revenue with a flat 15% tax and eliminate the 15.3% payroll tax while at the same time continue to fund a growing entitlement program operating under the existing rules.