Deficit commission submits final report for panel vote on Dec. 3
The Bowles-Simpson deficit commission released its final report today. The deficit commission report outlines across-the-board tax revisions and spending cuts designed to slash $4 trillion in deficit spending over 10 years. Analysts have little confidence that the report, called “Moment of Truth,” can be dealt with seriously by Congress.
The deficit commission’s ‘Moment of Truth’
The deficit commission is an 18-member panel co-chaired by Democrat Erskine Bowles, President Clinton’s former chief of staff, and former Republican senator from Wyoming Alan Simpson. The panel will vote on the deficit reduction recommendations proposed by “Moment of Truth” on Friday, Dec. 3. To put Congress on the fast track to implement its deficit reduction policy, 14 members of the panel must vote in favor of the proposal. In the deficit commission report, Bowles and Simpson said “The era of debt denial is over, and there can be no turning back. We sign our names to this plan because we love our children, our grandchildren and our country too much not to act while we still have the chance.”
Deficit commission report details
To make it more acceptable politically, the deficit commission report has been revised from a version submitted three weeks ago. The proposal reduce income tax rates and ends many tax credits and expenditures. The highest income tax rate would drop from 39.6 percent to between 23-29 percent. The Social Security retirement age would rise to 68 in 2050 and 69 in 2075. The income cap on payroll taxes would be raised to $190,000. To mollify Republicans, a cap on tax revenue was added, plus $50 billion in immediate spending cuts and an eventual return to 2008 spending levels. For Democrats, upper-income Social Security cuts and a Medicare voucher program for private insurance were scaled back.
Deficit reduction versus politics and the public
Few believe the uncompromising deficit commission report is politically realistic. The wheeling and dealing that has resulted in the current $1.3 trillion budget deficit and $13.8 trillion national debt will be a hard habit to break. The debt commission is submitting its blueprint for deficit reduction to a Congress continuing to pass legislation that inflates the bottom line. The public doesn’t appear to be on board either. Polls show most people agree the deficit should be reduced, as long as it doesn’t affect their own entitlements.