There was discord within both the liberal and conservative blogospheres over the proposals from the president's deficit commission, which was publicized today. In some cases, both liberal and conservatives bloggers were supportive of the report, like conservative blogger Kevin Williamson at NRO and left-leaning Atlantic blogger Andrew Sullivan.
I am surprised that the president’s deficit-reduction panel has produced such a sensible set of proposals: Eliminating tax write-offs while lowering tax rates is a big tax hike — a $100 billion-a-year tax hike, maybe more — but it is the right kind of tax hike, in my view. The simplification of tax filings for most Americans will provide additional private savings in the form of lower compliance costs. Raising the Social Security retirement age, reducing Medicare payments, capping federal revenues, chopping into discretionary spending — all are welcome. I do not think that the authors have “harpooned every whale” as Alan Simpson put it (Obamacare still haunts the fiscal depths), but it’s a very solid start, one that Republicans can pick up and run with.
I've quickly scanned the Simpson-Bowles draft proposal and find it extremely encouraging. It really does hit what the Dish regards as key themes for a new fiscal order: 1986-style tax reform (largely removing deductions and lowering rates); serious defense retrenchment; focusing social security on the truly needy and raising the retirement age; hard cost-controls in Medicare; a real populist attack on government waste.
It reads like the manifesto the Tea Party never published. Every detail needs thinking through and debate. Much of it is way over my head in terms of the specifics of government programs and the ability to cut them. But the core proposal is honest, real, and vital. I recommend you download and read both documents.
Other bloggers, including Bob Stein at NRO, listed what he liked and disliked about the report. Among his findings;
Here's what I like:
Trying to reduce spending as a share of GDP to 21 percent — very commendable for a centrist group.
Civil-service retirement-benefit reductions; requiring greater contributions for the government’s defined-benefit plan; making the benefit formula less biased in favor of older workers.
Indexing the retirement age in Social Security to longevity — very good. Bravo.
Here’s what I don’t like:
Although the plan says it would try to cap revenue as a share of GDP at 21 percent, there is nothing in the plan that would do so. Gradually, productivity will push a larger share of income into the higher marginal tax brackets, resulting in higher revenue relative to GDP.
Social Security solvency is achieved over 75 years only, rather than over the infinite horizon. This means that in ten years, when the 75-year window includes, at the back end, a ten-year window where solvency does not exist, we will again be back in 75-year insolvency.
The plan calls for increasing the tax base for Social Security. This is a large tax
hike for many workers.
Some liberal bloggers, however, flatly condemned the report.
Washington Monthly's Steve Benen noted some of the lower-profile suggestions in the proposal.
Some of my favorites -- and by "favorites," I mean ideas that I found astounding, not ideas I actually approve of -- include the elimination of hundreds of thousands of federal workers, the elimination of subsidized student loans, new costs imposed on veterans for their health care, cutting schools on military bases, and new entrance fees at the Smithsonian.
Sorry, you freeloading school kids.
And to think, 14 out of 18 commission members weren't ready to endorse this. Imagine that.
Also keep in mind, the cuts could be less severe in the Simpson/Bowles model if only they cut taxes less. But this plan calls for dropping the top marginal rate to just 23%. Under Clinton, it was 39.6%. Under George W. Bush, it was 35%.
I've seen some suggestions that the report, such as it is, should be considered "controversial." But that's not quite right. It's better to call this what it is: hopelessly irrelevant.
Daily Kos' Joan McCarter was equally pessimistic.
The recommendations of the chairs--from the big tax cuts to the decimating of the federal workforce--just don't fit the reality of the current economy with high unemployment, the loss of equity of so many retirees and near retirees in the one major asset most held--their houses, and the wage stagnation that has resulted in the great income equality in the nation. That's not even addressing the costs of two wars and the Bush tax cuts.