Last week, President Obama's former budget director Peter Orszag offered a quick fix for America's budgetary woes: Let the Bush tax cuts expire for everyone. "If we actually ended the Bush-era tax cuts, that would pretty much [balance the budget]" Orszag said on CNN. And according to The Washington Post, he's right:
Is this a sound policy initiative?
Official and independent budget estimates show that letting tax rates spring back to pre-Bush levels for all taxpayers would bring the country within striking distance of meeting President Obama's goal of balancing the budget, excluding interest payments on the debt, by 2015.
- Obama Should Consider This, writes Ezra Klein at The Washington Post: "Letting the Bush tax cuts expire would be just about enough to hit Obama's goal of balancing the budget (minus interest payments) by 2015. That's all they'd need: One non-act. Better: There'd be no sixty-vote threshold. You'd just need a veto of any extension bills and 34 votes to protect the veto in the Senate. And it's not as if there are no compromises available here. If Congress doesn't want to do it while the economy is weak, but could commit to doing it in two or three years, that would be almost as good. But nobody thinks it'll happen."
- Where Are All the Republican Deficit Hawks? asks Bruce Maiman at The Washington Examiner: "Let's hear from those deficit hawks: Let's step back and see those who are really interested in balancing that old budget and the ones who are just posturing. As usual, I'll place my bets on the posers who will be running for cover. As a reader pointed out, Republicans who want to extend the Bush tax cuts would be adding $3.7 trillion to the federal deficit over the next decade. Meanwhile, all Republicans want to repeal the health care reform law, which would add $455 billion to the federal deficit over the next ten years... Yeah, that figures."
- Economists Say It's a Bad Idea: We Should Extend Bush Cuts to Everyone, reports Chris Isidore
at CNN: "A majority of a panel of leading economists surveyed by
CNNMoney.com said that the tax cuts should be renewed for everyone. The
first in a series of economic surveys revealed that extending the tax cuts for all taxpayers is the most
important thing Congress can do to help the economy. Of the 31
economists surveyed, 18 chose that from a list of options now being
debated on Capitol Hill." He also interviews Moody's chief economist
Mark Zandi who says "If those tax cuts expire for everybody, we go into a
- Just Tax the Uber Rich, writes Paul Waldman at The American Prospect: "We have this idea that if you can call yourself a 'small business' then not only are you bathed in virtue but the choices we make about how to tax you should somehow be different than they are for other people at the same level of income. But if you're a 'small business' and you take home half a million bucks a year, then guess what: you're rich! And you ought to be taxed just like other rich people."