If you haven't already, you should head over to The New York Times' website to try out their interactive "budget puzzle." The calculator charges you with closing the budget gaps for 2015 and 2030, using a mix of spending cuts and tax increases. My plan was pretty straightforward; in the reverse of your typical conservative plan, 66 percent of my savings came from tax increases, while the remaining 34 percent came from spending cuts. On the cuts side, I eliminated farm subsidies, cut an army of government contractors, reduced spending on nuclear weapons, canceled some weapons programs, reduced the military to its prewar size, and ended the wars in Iraq and Afghanistan. Also, I enacted malpractice reform and reduced the tax break for employer-provided insurance.
On the tax side, I returned everything -- estate taxes, investment taxes, and income taxes -- to Clinton-era levels. I also added a millionaire's tax on income over $1 million, eliminated tax loop holes, closed the mortgage-interest deduction, created a bank tax, and threw in a carbon tax on emissions.
Two things are worth noting. First, it's a little silly to be thinking about the budget for 20 years down the road. Lawmakers in 1990 would have had a really hard time determining what the government should spend and cut in 2010, for the simple reason that things change a lot more quickly than we realize. This goes double for "deficit hawks" who want to fix the budget for 30, 40, or 50 years hence; it is impossible for us to know what the United States will look like in a half-century, and it's silly to budget for a period which might be completely unrecognizable. The difference between today and 1960 is astounding (for starters, black people can vote), and asking the legislators of then to account for the realities of now is absurd.
Finally, while it's possible to balance the budget with only spending cuts, that's only because health care eats up a huge portion of our future spending. By itself, reducing the tax break for employer-provided insurance and capping Medicare costs saves $719 billion over 20 years, or more than half of the shortfall. Indeed, with a carbon and bank tax thrown in, you can solve the deficit by capping health-care costs and restoring tax rates to Clinton-era levels. If you end the wars (or just reduce our troop obligation), you can solve the deficit without actually adding any new taxes.
I'm not sure that this budget puzzle is terribly useful, but insofar that it is, it's because it puts lie to the budget moralists who dominate the conversation. Our deficit comes from two things: our aging population, it's willingness to spend more on health care, and George W. Bush's decision to cut taxes and begin two wars. If you can slow the rate of health-care spending and account for Bush's policy mistakes, then you can operate the federal government -- with a small or nonexistent deficit -- without creating new taxes or forcing the least-able to bear pain or symbolic "belt tightening."
-- Jamelle Bouie