federal deficit
cross posted to policyresearch
I think it is time for the U.S. congress to pass another Gramm-Rudman-Hollings-style deficit reduction bill. There were certainly many shortcomings of the bills like its fixed dollar targets and the fact that it was applied to projected deficits. Moreover, the supreme court ruled that the process for determining cuts in the initial bill were unconstitutional…which lead to the passage of a revised bill in the form of the Gramm-Rudman bill (1987).
But one important principal in both bills that I think needs to be resurrected is: all of us have to tighten our belts to bring our federal budget in order. So I would propose that congress pass a bill with across the board minor spending cuts and tax increase triggers. Let us spread the pain with triggering minor increases to corporate taxes, income taxes, and capital gains tax rates, etc. and automatic cuts to entitlements, congressional salaries and government worker salaries.
And yes Gramm-Rudman failed, but I think it is worth another try and time to apply lessons learned from the GR failure. For starters a new bill should not have fixed dollar targets applied to projected deficits. Instead fixed percentage targets applied to the current years actual deficit would be improvements in that: 1) fixed percentages would mean cuts would not deepen when the economy weakened and 2) using the actual deficit would not create the incentive to create “rosy” projections as way of avoiding reaching targets.
Thoughts and criticism to this, perhaps lofty, idea are welcome.
The reading that got me thinking in this direction: a policy briefing by the Concord Coalition. The brief has its merits, but I don't agree with it. The Concord Coalition is a nonpartisan group dedicated to promoting responsible fiscal policy.
I think it is time for the U.S. congress to pass another Gramm-Rudman-Hollings-style deficit reduction bill. There were certainly many shortcomings of the bills like its fixed dollar targets and the fact that it was applied to projected deficits. Moreover, the supreme court ruled that the process for determining cuts in the initial bill were unconstitutional…which lead to the passage of a revised bill in the form of the Gramm-Rudman bill (1987).
But one important principal in both bills that I think needs to be resurrected is: all of us have to tighten our belts to bring our federal budget in order. So I would propose that congress pass a bill with across the board minor spending cuts and tax increase triggers. Let us spread the pain with triggering minor increases to corporate taxes, income taxes, and capital gains tax rates, etc. and automatic cuts to entitlements, congressional salaries and government worker salaries.
And yes Gramm-Rudman failed, but I think it is worth another try and time to apply lessons learned from the GR failure. For starters a new bill should not have fixed dollar targets applied to projected deficits. Instead fixed percentage targets applied to the current years actual deficit would be improvements in that: 1) fixed percentages would mean cuts would not deepen when the economy weakened and 2) using the actual deficit would not create the incentive to create “rosy” projections as way of avoiding reaching targets.
Thoughts and criticism to this, perhaps lofty, idea are welcome.
The reading that got me thinking in this direction: a policy briefing by the Concord Coalition. The brief has its merits, but I don't agree with it. The Concord Coalition is a nonpartisan group dedicated to promoting responsible fiscal policy.