Deficit Reduction

Why don't we let the the Bush tax cuts expire for everyone? That would raise a whopping $4 Trillion, which is 2 1/2 times what the Super Committee was trying to cut the deficit. Why limit the expiration of the Bush tax cuts to those making more than $250,000 a year; that only raises a comparatively much smaller $800 Billion? Adding $4 Trillion to the $1.2 Trillion of automatic domestic and defense cuts, now set to take effect in 2013, would make a significant impact on our deficit and debt.

Frankly I didn't think taxes were so crushing for everyone under Clinton and the Bush's early years. The country prospered during those years.

Some agree, but think that letting the tax cuts expire for everyone will exacerbates the income gap problem, which may be a problem even more serious and dangerous than the debt problem. I have been very concerned about growing income gap for a quite while; long before OWS. I'm still waiting for solutions (in addition to the ones I offered in my last post) other than taxing the rich. Just taxing the rich won't solve that problem.

Also, I don't completely understand the "tax the rich" solution reasoning since all statistics on the growing income gap are stated in gross income; not net after tax income.

While it may not make complete sense to use gross income comparisons, that is the way it's done; presumably because that way makes the gap bigger. The reason why using gross income rather than net income makes the gap appear bigger is that, notwithstanding what most believe, the rich do pay a lot of taxes.

Therefore by calculating the gap using gross income, raising taxes on someone who makes $1,000,000 a year gross does not reduce his income for purposes of making an impact on the income gap. Tax him all you want, he still makes $1,000,000 ( maybe more since he'll say he needs more to pay his taxes). Therefore that won't narrow the income gap.

Also raising taxes on the rich doesn't raise the income of the middle class . My guess is rolling back the Bush tax cuts for everyone won't raise taxes for the poor, period.

As to our deficit and debt problems, it's amazing to me how relatively easy it would be to really go a good long way towards solving these problems simply by going back to 2001 tax rates. Our tax rates today are near historic lows . I bet Europe wished it had problems that could be solved that easily. That's why I get so upset with Republicans for their "no new taxes" mantra .

Both parties agree, to a lesser or greater extent, that the defense budget needs to be cut significantly; especially with our two wars winding down.

Democrats need to compromise as well by cutting ineffective domestic spending and simply raising ( beginning years down the road) the eligibility age for Social Security and Medicare a couple of years, slightly adjusting cost of living indexes, and implementing other comparatively painless entitlement tweaks.

Because many Americans seem to be healthier and living longer, adjusting entitlements shouldn't be much of a practical problem. The trend towards a longer and healthier life is hopefully only likely to continue. What's so magical about 65 for Medicare anyway? Means testing is another solution. I would personally forgo receiving Social Security payments beyond the amounts I paid in.

Letting the Bush tax cuts expire for everybody, making meaningful cuts in general and defense spending, and rationally adjusting entitlements would actually result in the goal we, and the markets, have had for our government -- "putting our fiscal house in order"

Let's do all of this now, and insure our children and grandchildren's financial future before it gets much tougher to do.

Eric