A bar chart I saw indicated a larger portion of taxes than cuts. Can those tools in DC ever make real cut in spending?
RE: Can those tools in DC ever make real cut in spending?
We don’t even have to cut spending or raise taxes.
There is already a law proposed by then Rep. Connie Mack called the PENNY PLAN. This plan is supported by Senators Rand Paul and Jim DeMint.
H.R. 1848, would cut one-penny-out-of-every dollar actually spent by the federal government from year-to-year for the next six years, from FY 2012-FY 2017. Beginning in FY 2018, there would be a budget cap of 18% of GDP (the average federal revenue as a percentage of GDP over the past 30 years). And by FY 2019 America would finally have a balanced budget that is, assuming revenues naturally increase from the current 14.8% of GDP to 18% of GDP by 2019, after which the budget would be in surplus.
There is an automatic spending cut trigger under Mr. Macks plan one he came up with well before the trigger used in the recently passed national debt ceiling bill. If congress failed to enact a budget implementing the one-percent-actual-spending cut required under Mr. Macks measure, then there would be automatic, across-the-board actual cuts in all federal programs to meet the one percent reduction, and that means all: in defense, Social Security, Medicare, Food Stamps, defense and national security spending, everything.
Mr. Macks plan may seem draconian to some. It would cut the accumulated budget deficits by an estimated $7.5 trillion over ten years more than three times the amount achieved by the debt ceiling deal congress approved last Tuesday.
But it actually has a rather modest impact on reducing our total national debt. It wont be until 8 years from now that the budget will be in balance and the national debt starts getting paid down.
And I guarantee you — No one will starve and Grandma will still get the healthcare she is used to.
Federal taxes are <16% of GDP. Haven't been that low since 1950. Under Reagan the tax bite averaged 18.2% of GDP (17.3% was the lowest in any single year).
There won't be any real cut in spending until the welfare programs (SS and medicare/medicaid) are reformed. I see zero chance of that happening with baby boomers poised to retire with next to no savings. Housing market looks poised to take another leg down with FHA delinquencies on the rise, so consider that 'nest egg' too rotten to eat.
Save, save, save. And protect those savings in unleveraged assets, not dollars or homes.
All taxes, only cuts to Defense=GOP ‘compromise’