The Obama Debt Commission’s Democrat Co-chairman Erskine Bowles and prominent GOP Senator Judd Gregg (R-N.H.) today called for a massive, $26.7 trillion tax increase on the American people.
In an interview today with ABC News, Gregg said the following:
“Everything has to be on the table – there’s no question about that,” Sen. Judd Gregg, R-N.H., said on ABC/Washington Post’s “Top Line” today. “Erskine Bowles, one of the co-chairmen of the commission, has suggested a 75-25 split — 75 percent of the savings being in spending, and 25 percent in revenues…
“I think it’s likely that there will have to be a revenue component, but it should be significantly, dramatically — and a 3-1 ratio is pretty dramatic — dramatically less than the initiatives in the spending side of the ledger.”
So, Bowles wants $3 in spending cuts for every $1 in tax hikes. Gregg agrees with this ratio. If that sounds familiar, it should–it’s the same ratio that President Reagan was snookered into in 1982’s famous TEFRA deal. Reagan reportedly called that fake spending cuts/real tax hikes “deal” the biggest mistake of his presidency.
Bowles and Gregg can only be talking about cutting $3 in promised Social Security and Medicare benefits in exchange for $1 in tax increases. In other words, 1/4 of the unfunded liabilities of Social Security and Medicare would be paid for with tax hikes. So how big is that?
According to the 2009 Social Security and Medicare Actuaries’ Report, the long-run insolvency of the Social Security and Medicare systems is $106.8 trillion (with a “t”) over the infinite horizon. To close this gap with one-quarter tax hikes is, therefore, to raise taxes by $26.7 trillion. Of course, this number is undoubtedly higher since the Obama Administration is sitting on (read: hiding) the 2010 version of the report (it’s nearly six months overdue).
This just goes to show you that whether you are Democrat or Republican, both parties have spent so much money that they feel the only way to lower the debt is by raising taxes. God help it if they decide to put a freeze on spending or do something drastic like that.
Anyone that thinks you should raise taxes, on anyone, in our current environment knows absolutely nothing about economics.
All these bozos need to be voted out of office.