As the end of 2011 approaches, Americans across the country are watching our elected leaders in the nation’s capital and wondering what the future holds. As any Alaskan who pays any attention at all surely knows, things are not exactly functioning as they should in Washington. We face historically high annual deficits, and a cumulative level of national debt unprecedented in our nation’s history. The unsustainable debt places our country on a path to perdition, down which the rest of the world thereby becomes increasingly likely to follow.
Earlier this year, this dire situation led to a crisis in governance, with Congress and the President only just narrowly agreeing at the last moment to terms upon which the so-called debt ceiling might be raised. This is the level of public borrowing through the sale of government bonds that Congress sets as the absolute maximum (at least until it raises it again). Because of the showdown, and the fact that an agreement (ephemeral at that) wasn’t reached until the last minute, the credit rating of the United States of America was downgraded, an historical embarrassment that didn’t need to happen and which needs to be undone.
Serving as co-chairman of the Capital City Republicans, and supporting my party’s main approach to fiscal and monetary policy, I still can’t lay all blame for the undesirable status quo on the other side of the aisle. The problem has simply become too big for it to be allowed to fester and remain unsolved on partisan lines.
The temporary solution to the debt-ceiling crisis was the formation of the Joint Select Committee on Deficit Reduction, which was quickly nicknamed the Supercommittee. In the end this panel ended up being anything but super. Its deliberations, such as they were, appear to have consisted of Republicans refusing even to consider any increases in any marginal tax rates while Democrats shut their eyes, ears, and minds to any reductions in the lion’s share of federal spending: entitlement programs including Social Security and Medicare. It’s little surprise this group failed to arrive at even a short-term compromise by the appointed deadline of the 23rd of November.
Tough times call for tough choices. Spending on things other than national defense and entitlements is generally referred to as discretionary. There are clearly a great number of places where money is wasted in our federal government’s day-to-day operations, including defense. These range from shoddy if not corrupt procurement practices to unnecessary and redundant personnel whose jobs could be eliminated with no diminution in the quality of life for American taxpayers. Obviously such cuts will have most draconian effect on those individuals whose positions are cut, but we can’t base our collective federal spending decisions on individual personal employment situations.
There has been talk of eliminating whole federal departments as a silver bullet to slay the deficit and debt monster. This is an oversimplified approach to achieving the meritorious goal of finding savings in discretionary spending. The far better although more difficult course of action is for the president to direct his cabinet members to look at their departments and to come back with honest assessments of what valuable services they provide and what can go away. Things that can be left to the states through block grants that leverage federal matching money ought to be prioritized because services are almost always delivered better at the state and local level. But even were this process of self-sacrifice to go forward, it wouldn’t close the gap, because so much federal spending is dictated in automatic terms to entitlement beneficiaries.
There is no way the federal budget crisis is going to be solved until the retirement age is raised and some level of means-testing is applied to entitlement benefits. That means people will have to work longer before retiring and becoming eligible for benefits, and it means that well-off retirees will forego some or all benefits and allow those who earn less to receive them instead. If Ds can accept this bitter pill as part of a long-term compromise, then Rs will have to admit that meaningful tax reform must be pursued.
Many Republicans have already conceded that numerous loopholes and silly deductions could go away, but that won’t be enough to solve the problem on the revenue side.
It is not as if God Almighty has commanded that the top marginal tax on income never exceed 35 percent. The top rate in the United Kingdom is 50 percent, and it was once 90 percent after the Second World War (under a Labour government of course). An open discussion about how some significantly wealthier Americans might pay more could take place, but threatening millionaires’ taxes won’t get us there.
Between the Tea Party and the Occupy [Name of Place] movements, there is abundant passion and energy to notify Washington that things need to be fixed. But we can’t just hold our collective partisan breath and turn blue or red in the face, and expect that to substitute for dialogue and devising real solutions. America’s too wonderful a place to take the path of least resistance.
• Brown is an attorney who lives in Juneau.





Comments (10)
Add commentWow, no wonder Juneau
Wow, no wonder Juneau Republicans get walked all over if this is what passes as their leader.
All I read from Brown was compromise with the Democrats, raise taxes on the rich and cut everything else in the budget except entitlements.
Way to stand up against the big government crowd!
wrong audience
Ben, your opinion piece should be directed at your party's representatives in congress, not Juneau readers.
Thank You Ben!
Calypso you are part of what is wrong in Washington. Your close minded approach would watch our country burn to the ground while you point the fault finger. Bet I could find lots of ways to cut some spending...but you wont like my ideas any more than I like yours..so now what do we do?
And...it's OK to be the leader of your party and be a free thinker. Party robots scare me.
@Mama T
WELL SPOKEN!!!!!
Woefully short, as expected
"Spending on things other than national defense and entitlements is generally referred to as discretionary."
Um, no Ben. Defense spending is subject to annual appropriations by congress, thus it, too, is 'discretionary'. It's actually quite disturbing that the chairman of the local republican party wouldn't understand that basic term. But not really surprising.
And of course, according to Ben, the problem is too many government workers...and he fails to mention the massive government contracts. Most tax dollars are spent buying things and services (like defense contracts from Halliburton), not paying federal workers.
You also missed a couple easy revenue solutions, Ben:
- How about eliminating the income ceiling on social security taxes? Right now only income up to around $106,800 is taxed - everything above it is not. Do this and any social security shortfalls are instantly eliminated.
- Start taxing capital gains like ordinary income. The vast majority of the super-rich's income comes not from payrolls, but in capital gains from investments. And they only pay a 15% rate on that income, and no medicare or social security taxes on it. Treat that income as the income it is, and tax it at the current marginal rates.
Maybe these two changes alone would solve the longterm budget problems, and we wouldn't have to force Americans to work until they're 70. Or raise rates on the rich back up to 90%.
Oops, 3rd change you forgot to mention...
Let Bush's tax cuts for the upper income levels expire. Along with the two ideas mentioned by latitude58, problem solved.
58
The only problem with taxing capital gains as income is that if done less investment is the likely outcome.
Means testings a start, but if we really want to control waste, fraud & corruption the best test is a drug test. Anyone working as a federal employee, all elected officials & all welfare recipients should have to pee in a cup (just like most of us)if they want their paycheck, payouts or in the case of elected officials payola.
Less investment??
That doesn't make any sense. Returns on investments have the potential to far outweigh other forms of monetary recompense. If I have a choice of investing $50,000 into a CD, earning 6% annual interest and paying standard taxation rates on my return, or investing $50,000 into stocks or real estate, getting anywhere from 20%+ and paying standard taxation rates, do you really think someone will select the former?
reward actual jopb creators
When the GOP stops hiding wealth under the guise that it is the wealthy who create jobs there is hope things could get better. One person takes his wealth and invest part of it in gold. Sure enough he has made a fair return on the gold after a year holding period. He did not create a single new job . Yet he gets a tax brake for his capital gain. A second person starts a bakery and coffee shop. The new business employes ten people in jobs that did not exist prior to the opening of the new shop. The person who risked their time, efforts and capital to actually create new jobs gets nothing special like a reduced tax rate for capital gains the gold investor receives.
Perhpas it is time to stop all the talk about how the wealthy create jobs and reward those who actually do. Lets see the GOP explain how simple investments into things like gold, land or rentals properties makes the wealthy job creators.
I don't know
What I don't know, among so many other things I don't know, is how many of today's wealthy - like the Walton family of Walmart- worked hard, suffered hardships in making a living and then became "successful." One might even add Mitt Romney, Paris Hilton and Donald Trump.
And how many inherited their wealth and wish to protect themselves and heirs to pass that on to future generations of the family.? Are they all "job creators" or just protecting themselves?