By Americans need an automatic pay with cost of living too.
By John Hayward
Once again, Americans are asked to compromise with ruin.
Writing in the Wall Street Journal, Stephen Moore takes stock of the bipartisan Super Committee, charged by the Budget Control Act of 2011 with producing a certain amount of deficit reduction before Thanksgiving, in order to avoid triggering some automatic spending cuts designed to be painful in a bipartisan way (i.e. automatic cuts to the Defense Department are only supposed to bother Republicans.)
The clock is ticking, and “insiders” tell Moore things are not looking good for a deal:
Insiders on the panel say that the deal being offered by Democrats is less than $1 of spending cuts for every $1 of new taxes. Democrats want to count the $900 billion of discretionary spending cuts already agreed to in the debt bill and $1 trillion in troop withdrawals from Afghanistan and Iraq, which may not happen. Meanwhile they are insisting on close to $1.2 trillion of tax increases in exchange for less than $1 trillion in entitlement reforms. The president’s own deficit reduction committee, Simpson-Bowles, offered $2 of cuts for every $1 of new taxes. The GOP House budget passed last spring contained some $4.5 trillion in cuts—three times more than the super committee must find.
To break this deadlock, Super Committee Republicans are fiddling with the idea of eliminating various tax deductions to bring in more revenue without raising tax rates. Imposing means-tested caps on the deductions for charity, state and local taxes, and mortgage interest is an example. Likewise, corporate tax deductions could be eliminated – perhaps including those notorious “green” tax subsidies – with a small reduction in the corporate tax rate to cushion the blow.
Moore relays a quote from Republican Super Committee co-chairman Jeb Hensarling that sums up what this is all about: “I can find $1.5 trillion of budget savings in my sleep. The hard part is getting six Democrats to agree to it.”
That’s not just the hard part, it’s the crazy part. The notion that we’re discussing any form of “revenue enhancement” when Washington is throwing billions of dollars around with wild abandon is offensive. The Super Committee’s work should be entirely based on spending cuts. That $1.5 trillion figure Hensarling quoted is projected over ten years. What sane person believes Washington can’t find $150 billion in ludicrous, wasteful, and downright un-Constitutional spending per year to cut? The federal government blows through $150 billion every two weeks.
In fact, it wouldn’t be that difficult to find $1.5 trillion of annual lunacy to strip away. Rep. Hensarling would probably need to wake up in order to do it, but he wouldn’t break much of a sweat. The Super Committee could achieve almost five times its required deficit reduction target over the next decade merely by ending the practice of automatic federal spending increases.
As it happens, $1.5 trillion per year is roughly the amount Barack Obama has added to the permanent “baseline” budget, and it’s not far from the current federal deficit. The Super Committee is locked in a death struggle over getting us 10% of the way back to George Bush’s outrageous spending levels. Committee Democrats are adamantly insisting they can only see their way clear to cutting 5% of Obama’s irresponsible spending… and that’s only if they get more than $1 in new taxes for every dollar of spending cuts.
The American people are, once again, being asked to compromise with ruin. We’re asked to believe the net effect of the 2010 electoral landslide is that Big Government will only retain 90% of its growth, and we’ll have to pay more in taxes for even that piddling concession. It’s the latest absurd installment of the game we’ve been playing for decades – a game rigged to produce more government growth no matter how the dice come up.
The “dramatic” Super Committee conclusion to the debt ceiling “crisis” of 2011 ratifies the notion that government bloat has utterly irresistible momentum. No matter how insolvent it becomes… no matter how corrupt, inefficient, and wasteful… no matter how many failed “stimulus” packages Americans, of this generation or the next, are compelled to pay for… government just gets bigger and bigger, at a rapidly accelerating pace. When it comes to spending increases, trillions per year are the currency of the realm nowadays, but when we talk about spending cuts, trillions per decade are too large a unit of measure for statists to handle.
And when the people of the United States recoil in horror from the approaching crash of this system, they’re told the alternative to making the federal government larger through suicidal deficit spending is to make it larger through massive tax increases! If the people can’t be suckered into accepting rate increases through class warfare, then more revenue will be grabbed by ending or capping deductions. Heads the government grows, tails the private sector shrinks.
Reducing the complexity of the tax code, by eliminating the maze of social-engineering deductions and incentives, is a worthy goal… but it should come as part of a historic tax reform package, on the scale of a flat tax or Herman Cain’s 999 Plan, not as a revenue enhancement tool for the political hacks who expect us to believe cutting $150 billion per year out of a $3.6 trillion government – which, thanks to Senate Democrats, doesn’t even have a budget – is impossible. Perhaps Jeb Hensarling really could do it in his sleep. The committee he co-chairs is a snooze bar Washington slapped to silence the debt-ceiling alarm, until the rest of us went back to sleep.