Deficit Panel's Leaders Push Cuts

Proposal to Save $3.8 Trillion Targets Medicare, Pentagon, Middle-Class Tax Breaks

From The Wall Street Journal:

WASHINGTON—The leaders of a White House commission laid out a sweeping proposal to cut the federal budget deficit by hundreds of billions a year by targeting sacrosanct areas of U.S. tax and spending policy, such as Social Security benefits, middle-class tax breaks and defense spending.

The preliminary plan in its current form would end or cap a wide range of breaks relied on by the middle class—including the deduction for home-mortgage interest. It would tax capital gains and dividends at the higher rates now levied on wage income. To compensate, one version of the plan would dramatically lower and simplify individual rates, to 9%, 15% and 24%.

The co-chairs of a deficit commission established by the White House has called for limiting federal spending on health care, gradually raising the retirement age and lowering the corporate tax rate. Jerry Seib discusses.

Overall, the plan would hold down the growth of the federal debt by roughly $3.8 trillion by 2020, or about half of the $7.7 trillion by which the debt would have otherwise grown by that year, according to commission staff. The current national debt is about $13.7 trillion.

For businesses, the controversial plan would significantly lower the corporate tax rate—from a current top rate of 35% to as low as 26%—but also eliminate a number of deductions. It would make permanent the research and development tax credit.

Read it all!!!!!!

Finally something coming from Washington, DC that makes sense.  Bravo to the Commission for "getting it."  Nobody has said that this would be easy.  If the spineless bastards (on both sides of the aisle) in Congress get their way and gut this proposal we will most certainly be facing collapse of our economy within just a few years, if not sooner.  As for tax increases - if some taxes have to go up - fine.  I view that as "paying it forward" to our children and grandchildren.  The time has come to have this debate!!  It's time  AGAIN to make calls and send letters.  Tell the Congresscritters how you feel!!  Let's make our voices heard AGAIN!!!-SP