TW: Frankel is a progressive economist (Harvard) but he identifies ten steps to address the deficit. They are almost amusing in their utter unliklihood of actually being enacted even though I would agree with most of them. Again defining the choices are so easy, getting the public to support them a different story.
From Jeff Frankel's blog:
First, auction off most greenhouse gas emission permits, rather than giving them away to firms (which would confer windfall profits). This is what President Obama originally proposed last February, but it is not in the congressional legislation.
Second, raise the gas tax. Among the benefits, besides raising revenue, would be reducing traffic congestion, accidents, pollution, dependence on Mideastern oil, and the trade deficit.
Third, cut agricultural subsidies to rich farmers and agribusiness, saving money and improving economic efficiency. This is another measure that Obama proposed when he first took office, but that was voted down.
Fourth, continue to cut expensive weapons systems that the military doesn’t want, but are kept only because the suppliers are in the districts of influential congressmen. President Obama and Secretary Gates amazingly managed to do this with the F22 (the first administration to succeed at such a thing, or even to try, so far as I know).
Fifth, end manned space exploration. We don’t need it. Spend half the money on useful science instead, including research on energy and medicine (and unmanned space exploration).
Sixth, let the George W. Bush tax cuts for the rich expire as under current law. Of course the Bush plan to eliminate the estate tax completely in 2010 and have it bounce back to its 2001 level thereafter is nonsense. Level the taxable threshold out at some reasonable estate size, a few million dollars, something high enough to de-legitimize the hysterical stories about inheritors supposedly being forced to sell their small farms or small businesses to pay the tax. (Use some of the revenue in these proposals to fix the AMT once and for all. And, in the meantime, continue Obama’s return to honesty in budget accounting regarding the costs of AMT, wars in Iraq and Afghanistan, tax cuts, etc. Bush’s habitual trick of purposely understating such costs in future budgets allowed him to pretend that we could afford his profligate fiscal policies, which in turn added far more to the national debt than the current recession measures are adding .)
Seventh, encourage hospitals to standardize around national best-practice medicine – to avoiding unnecessary tests and procedures – using levers such as making Medicare payments conditional on best practices. This is another part of the Obama plan. (Don’t follow the logic of radio show propaganda that labells even modest government involvement in health care “socialism,” because that would certainly require dismantling veteran’s hospitals, which provide good medical care relatively efficiently, even before it would require dismantling Medicare.)
Eighth, limit or eliminate the tax-exemption for employer-paid health insurance (proposed by Senator McCain), at least the cadillac plans which are very expensive but don’t even pay off in health results (proposed by Senator Kerry).
Ninth, ideally, eliminate the tax deductibility of mortgage interest too. But proposing this would be political suicide. Congress and the public are still virtually unanimous in wanting to tilt the playing field in favor of owner-occupied housing and against rental housing and the rest of the capital stock, notwithstanding that such policies contributed to the housing bubble and crash.
Tenth, to save Social Security, raise the retirement age (just a little), tax higher incomes (just a little), and progressively index benefits for future retirees to price inflation, rather than to wage inflation (just a little)."
http://baselinescenario.com/2009/12/01/feudal-lords-of-finance/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+BaselineScenario+%28The+Baseline+Scenario%29
No comments:
Post a Comment