All The Cool Kids Are Playing
The New York Times has a neat interactive tool to look at the effects of various deficit reduction policies on the deficit. It’s fairly eye-opening to see the effect of various proposals on the deficit – I think the Republican Congressional delegation should study this. Go play with it and report back your results.
Where’s the “unicorns” option?
I did it.I eliminated the deficit.
And my way worked pretty well for the middle-class and the poor unfortunates below.
I still had options left.
We know the Rethuglicans leash is held by Big Banks and Business.
As is our own senior senator, Tommy the Carpetbagger Carper.
How many more Dems. are held by the same leash?
We’ll soon be finding out.
Skip: Can you list your choices? I ran out of easy choices at about $750 billion, and had to make up the difference with the Medicare payout cap.
This is way better than those where-are-you-on-the-political-spectrum quizzes:
“Show me your budget, and I will tell you what your values are.”
The lesson is that it is a waste of time to argue about spending cuts vs. tax increases – we need to do both.
I think it’s a good exercise – it shows you can’t get there by spending cuts alone or just tax increases (at least the current proposals).
I did find it interesting that there weren’t many proposals on Medicare but it takes up a big part of the deficit projection. SS is only a small part, but a lot of proposals on it.
It is unfortunate that “Repeal HCR” was not an option. It would have been educational to the wingnuts to see the bar go the opposite way of what they expected.
There were a lot of left-leaning options missing, including important health care cost controls like public option health care, Medicare buy-in, drug price negotiation. Also, I didn’t see ending the carried interest loophole, which by the way is an Obama campaign promise.
Also missing were key features of the Paul Ryan roadmap, like elimination of capital gains tax and corporate taxes, privatization of Social Security, voucherization of Medicare/Medicaid.
“It is unfortunate that “Repeal HCR” was not an option. It would have been educational to the wingnuts to see the bar go the opposite way of what they expected.”
you are assuming their news sources would allow them to see the report. You are also assuming if somehow they did manage to see it, that they would actually believe the numbers. Remember, as far as baggers are concerned, if it isnt Glenn Approved, it is a liberal-leftists-progressive-socialist-communist-statist-muslim-gayagenda-eliteist lie.
I am bothered that Social Security is lumped in with the rest of it. SS is not part of the General Fund, so lumping it is inappropriate, in my opinion.
Either way, I reduced the deficit to 7 Billion in 2030 with the following:
No farm subsidies (although the proposal is not as precise as it should be)
Cutting contractors
Reduce military to pre-Iraq levels
Reduce fleets
Delay weapons programs
Reduce Afghan presence to 30K
Reduce Employer tax breaks on Health Insurance
Social Security means testing
Return Estate tax to Clinton Era levels
Clinton’s investment taxes
Bush tax cuts expire on 250K and above
change 106K cap on income (this should be separate and with SS)
Millionaires tax
Eliminate loopholes and keep taxes slightly higher
Carbon tax
My list actually makes the 2015 budget have a surplus. If we can apply that surplus to future budgets, I think I close the 2030 gap and balance that too.
Here is the Delaware Dem Plan for Saving America:
1. Eliminate Earmarks ($14B)
2. Eliminate Farm Subsidies ($14B)
3. Cut pay of civilian federal workers by 5 percent ($14 billion /$17 billion)
4. Reduce the federal workforce by 10 percent ($12 billion / $15 billion)
5. Cut 250,000 government contractors ($17B)
6. Misc. Cuts that eliminate some agencies ($30B)
7. Reduce nuclear arsenal and space spending ($19 billion / $38 billion)
8. Reduce military to pre-Iraq War size and further reduce troops in Asia and Europe($25 billion /$49 billion)
9. Reduce Navy and Air Force fleets ($19 billion / $24 billion)
10. Cancel or delay some weapons programs ($19 billion / $18 billion)
11. Reduce the number of troops in Iraq and Afghanistan to 30,000 by 2013 ($86 billion /$169 billion)
12. Enact Medical Malpractice Reform (this is a compromise I see happening to keep funding of ACA intact) ($8 billion /$13 billion)
13. Increase Medicare Eligibility Age to 68 ($8 billion /$56 billion)
14. Raise Social Security Age to 68 ($13 billion /$71 billion)
15. Return the Estate Tax to Clinton-Era levels ($50 billion /$104 billion)
16. Return Investment Taxes to Clinton-Era levels ($32 billion /$46 billion)
17. Allow expiration of Bush Tax Cuts for income above $250,000 a year ($54 billion /$115 billion)
19. Payroll tax: Subject some incomes above $106,000 to tax
When the payroll tax, which finances Social Security and Medicare, was created, it covered 90 percent of all income. Today, with a ceiling at $106,800, it covers closer to 80 percent. This option would gradually raise the ceiling, until 90 percent of income was again subject to the tax. ($50 billion / $100 billion)
20. Millionaire’s tax on income above $1 million–Currently, the top tax brackets starts at about $375,000. In past decades, it started at much higher income level, after inflation is taken into account. This option – which the House passed last year but the Senate did not – would create a new 5.4 percent surtax on income above $1 million. ($50 billion /$95 billion)
21. Carbon tax–this option would tax carbon emissions, starting at $23 per ton of CO2. The tax rate would increase at a constant annual rate of 5.8 percent, from 2012 through 2050. ($40 billion $71 billion)
22. Bank Tax–This option would tax banks based on the size of their holdings and the perceived riskiness of those holdings. Larger, riskier banks would pay more tax, both to discourage them from taking big risks and to help cover the costs of future financial crises. ($73 billion /$103 billion)
23. Cap Medicare growth starting in 2013–This option would cap the Medicare growth at G.D.P. growth plus 1 percentage point, starting in 2013. Among other things, this would crack down on many hospitals and doctors with the highest costs. ($29 billion /$562 billion)
I would have adopted the elimination of Bowles Simpson tax loopholes plan, except I want to keep the mortgage deduction and I would restore the credit card interest deduction too. Since I didn’t adopt the Loophole Plan, I had to cap medicare growth. In reality, a mixture of the two options is what is needed. Eliminate some loopholes and cap medicare growth but at a higher rate than GDP+1.
This creates a projected 2015 surplus of $258 billion, and a 2030 surplus of $396 billion.
Once you cap Medicare costs, and expire the tax cuts, you suddenly gain the luxury of quibbling over everything else.
It is interesting how many spending cuts liberals are coming up with in their solutions. In your face, wingnuts!
What is your ratio of spending cuts/tax increases? Mine was 65/35.
Mine was closer, like 60/40.
It is a Kobayashi Maru exercise.
“It is a Kobayashi Maru exercise.”
How so? There are multiple ways to “win.”
It doesn’t account for counter-attacks from teabaggers or wingnut media. To make it more realistic there needs to be sidebar trackers for things like “unemployment rate” and “number of uninsured,” aggregated in a “political health” score as you select each option.
My list:
Eliminate earmarks
Eliminate farm subsidies
Cut aid to states
Reduce nuclear arsenal/”star wars” program
Reduce military to pre-Iraq size
Cancel or delay weapons programs
Reduce Iraq/Afghanistan troops to 60,000
Reduce SS benefits to higher earners (means testing)
Tighten SS disability
Obama’s estate tax proposal (middle option)
Return capital gains/dividend tax rates to Clinton levels
Expire Bush tax cuts above $250,000
Raise cap on SS pay-in
Enact millionaire’s tax
With all this, I got to $396 billion short-term, but only $796 billion by 2030. At this point, I’m 51% tax increases, 49% in spending cuts.
Once I add in the Medicare payment cap, I’m slightly in surplus both short- and long-term, and my balance is 66% spending cuts, 34% tax increases — all without touching SS benefits or taking away existing tax breaks. Means-test some of those tax breaks and I can restore some of the previous cuts.
True enough. I was thinking about that when playing with SSN and Medicare. “You have just cut benefits for the wealthy elderly, thus saving billions. However, the RNC immediately cuts television spots showing President Obama shoving grandma out of her wheelchair and then running over her with a bus. All Democrats are defeated for reelection. Everywhere.”
anon: That’s not the point of the exercise. None of this is politically feasible.
DD: Shame on you for raising SS eligibility age! We geezers protest emphatically! If it weren’t for our COPD, we’d shout epithets at you!
We need the geezers to retire at 65 if not sooner just to free up their jobs. If we raise the retirement age it will slow job turnover. I wonder how many people are deferring retirement while waiting for the stock market to recover, tying up their job.
My List:
CUTS:
Earmarks
Farm Subsidies
Government Contractors
Reduce nuclear arsenal
Reduce force strength to pre-Iraq levels
Reduce Navy and Air Force fleets
Reduce troops in Iraq and Afganistan to 30K by 2013
Reduce tax break for employer provided insurance (I am assuming there would be an accompanying push for a public option here)
Cap Medicare Growth (even though caps are Stupid)
Reduce SS for higher income folks
TAXES:
President Obama’s Estate tax proposal
Clinton era levels of investment taxes
Expiration of tax cuts for <250K (altho I’d like to see them all expire)
Raise payroll taxes
Carbon Tax
Bank Tax
(although I like the elimination of loopholes and a reduction of rates, here the devil is in the details making sure that this is not a regressive tax policy)
So 36% of the solution from tax increases and 64% from spending cuts. I even have a 125B surplus in 2015 and a 233B surplus in 2030.
Link to solution.
It is not terribly difficult to balance the 2015 budget a number of different ways, as long as you don’t look at the 2030 budget.
It is not terribly difficult to balance either budget as long as you know you don’t have to be responsible for getting support for it or implementing it.
Well, the more ways there are to balance the budget, the more ways there are to attain a compromise in real life.
Remember, in the short term, a 50% deficit cut is a huge win for Democrats – as long as we are perceived as initiating it, rather than being dragged to it by Republicans. And jobs.
Elections are not won on the budget 20 years out – which will be mostly determined by health care. Remember. the NYT tool doesn’t allow for health cost control other than Medicare cap. There is plenty of time for unicorns to appear, or (what’s the opposite of unicorns?) Clinton’s balanced budget was created by unanticipated economic growth and was not projected even 8 years before.
Geezer, I think it makes sense to raise it, but we should grandfather it in. For example, for those over 50 and older right now, you can retire at 65. For those under 50, you are working until 68. We are living longer, plain and simple.
Jeez, Geez, sorry for not getting back to you.
They were all the lefty of the leftist I’m sure.
“Out here on the perimeter there are no stars.”
I have 69% from tax changes, 31% from spending cuts
cut foreign aid, farm subsidies, earmarks, cut nuclear arsenal, reduce military to pre-Iraq War levels, reduce fleets, cancel/delay some weapons programs, cut iraq/afghanistan troop levels to 30,000 by 2013, reduce SSA benefits for high income folks, obama’s estate tax proposal, obama’s investment income tax proposal, allow bush tax hikes for high income folks, payroll taxes on income over $108K on a sliding scale, millionaire’s tax, eliminate loopholes, convert mortgage interest deduction to less-costly credit, carbon tax, too-large-to-fail bank tax.
Took care of 2015 by over 50%, handled 98% of 2030 problems.
Two points.
1. Worrying about the budget deficit before we even have an economic recovery is stupid. Keynes wept.
2. “Even the liberal” NYT is using Bowles-Simpson as the baseline for deficit reduction. That’s perhaps even more stupid. Medicare accounts for the vast majority of the deficit in future years. Social Security is a tiny sliver, even if you count it, and you really shouldn’t because it pays for itself and can be made solvent with very minor tweaking. Discretionary spending is also, relatively speaking, not a lot of the deficit. Any serious proposal would spend most of its time addressing Medicare, a relatively minor amount of time on discretionary spending, and no time on Social Security.
I don’t like reducing Social Security – for one, it’s not a deficit problem. Medicare is.
If you play around, you’ll see something really interesting. I tried to balance the budget using only cuts and I found that the long-term deficit balanced fast, but the short-term deficit didn’t. It’s the opposite of what I found using tax changes.
I don’t trust 20-year out projections so cutting the deficit sooner is better I think.
Another thing that’s amusing is seeing how little an earmark ban cuts the deficit.
Another thing that’s amusing is seeing how little an earmark ban cuts the deficit.
The NYT tool does neatly separate the idealogues from the wonks.