The Simpson-Bowles Report: Deficits are the little people's problem

The Simpson-Bowles Report on deficit reduction has not technically been released.  The report that came out today was just Simpson and Bowles recommendations.  The Committee has to agree to recommendations, so it will likely include three concrete proposals in the end: Cut no programs, Raise no taxes, End "waste".

So it will likely be adamantly anti-waste.  Yippee.

But the main issue I have with the report is its focus on Social Security.  It has three main proposals: Raise the retirement age, raise the maximum income that can be taxed and cut benefits.

Two of those come at the expense of the middle class: raising the retirement age and cutting benefits.  The third comes at the expense of the rich.

Raising the retirement age makes sense if you're a lawyer or a doctor or an executive.  It makes less sense if you're a long haul trucker or a coal miner or a waitress.  Reducing benefits will also pinch middle class retirees the most (I think they actually increase benefits for the poor).

But from everything I've heard, all you really have to do is raise the cap on the social security tax.  Raise that, and you make social security solvent for as long as they care to project it outwards.

But if we're going to tax that segment of the population who has benefitted the most from the past 30 years, it is apparently necessary to hit those that have struggled twice as hard.

Like I said: the New Gilded Age.  If you're not rich, it's your fault.  And you should suffer for your lack of "character".

The final kicker is this: extending Social Security's solvency into the next century is a worthy goal.  But it won't do diddly to reduce the deficit.  It will help keep SS from dipping into operating revenues in a few decades, but it won't solve any of the systemic problems we have with the budget deficit.

And why do we have a problem with the budget deficit?

That's the top marginal tax rate since we've had an income tax.

Funny how it exploded around the time we cut the top marginal tax rate...

Coincidence?

Whenever someone talks about returning the top marginal rate to anything close to what it was before Reagan, they are accused of class warfare.  But the truth is, class warfare was waged and won by the very wealthy in the 1980s.  And the wrecked budget deficit is a direct by product of that.

But as the GOP takes over the House and talks about "fiscal responsibility" you can bet the farm that "revenue increase" won't pass their lips.  Ever.

So, Read My Lips: No Deficit Reduction!