Selection of certain statistics from the latest Budget report allows those in the political arena to make two wildly opposing arguments. There is a case to be made for the urgent need for another round of spending designed for growth and job creation. There is just as strong a case for drastic reductions in government expenditure, slowing America’s descent into unsustainable debt.
Entries in Douglas Elmendorf (2)
Next Thursday, the Joint Committee on Deficit Reduction --- the so-called Super Committee --- begins in earnest its search for $1.5 trillion or more in cuts to the national debt over the next ten years. Its first item, “Overview: Revenue Options and Reforming the Tax Code", will look at ways that the code can be simplified through the elimination of many tax "breaks" currently enjoyed by both individuals and corporations. No surprise there: proposals for tax reform, of varying scales, have been included in every deficit reduction plan that has appeared since the publication of the Bowles-Simpson report in January, and both sides of the political divide have made noises over the past year that they are willing to consider changes in the way Americans are taxed to help stabilise the debt.
But that is as optimistic, for those who actually want to see the committee achieve its goal, as it gets these days in Washington. Already, the two political parties are staking the same rhetorical and ideological positions on revenues that soured the debt-ceiling negotiations back in July, talks that resulted in historic nationwide disapproval of politicians in Congress.