Three NYT op eds on the budget:
"A trick question: If Congress takes no action in coming years, what will happen to the budget deficit? It will shrink - and shrink a lot. This simple fact may offer the best hope for deficit reduction. As federal law currently stands, some significant tax increases are set to take effect in coming years. The most important is the scheduled expiration of the Bush tax cuts at the end of 2012...If Mr. Obama wins re-election, he could simply refuse to sign any budget-busting tax cut for the rich...Republicans, for their part, could again refuse to pass any partial extension. And just like that, on Jan. 1, 2013, the Clinton-era tax rates would return. This change, by itself, would solve about 75 percent of the deficit problem over the next five years." [David Leonhardt, NYT op-ed]
"[W]e can't let the oldsters get off scot-free. As my colleague David Leonhardt reported in The Times, two 56-years-olds with average earnings will pay about $140,000 in dedicated Medicare taxes over their lifetimes. They will receive about $430,000 in benefits. This is an immoral imposition on future generations. The Ryan budget wouldn't touch this generation, but a bipartisan budget deal should ask middle-class and affluent boomers to make a sacrifice for their country. Slow the growth in health care benefits now and dedicate that money to paying down the debt and investing in the young." [David Brooks, NYT op-ed]
"Public policy is going to be made from inside a fiscal straitjacket for the foreseeable future. But within that straitjacket, Washington can favor policies that enhance working-class opportunity, while ruthlessly paring back those that subsidize the affluent. The goal shouldn't just be small government, but what the economist Edward Glaeser calls 'small-government egalitarianism.' There are elements of this vision woven into the Ryan budget - cuts to farm subsidies, means-testing for Medicare, and promises to go after tax expenditures that primarily benefit the rich. But at least in its initial draft, too much of the budget's austerity is borne by downscale Americans." [Ross Douthat, NYT op-ed]
(Nod to Kevin Lewis)
Some thoughts: Douthat's "subsidize the affluent" is a little strange, as is the whole "tax cuts for the rich" meme. 47% of American pay ZERO fed income tax. How would you cut their taxes? You can only cut taxes on people who PAY taxes (I'm an economist; I know these things).
Still, and as Angus has said, we certainly could means test SocSec/Medicare, and by all means should cap mortgage interest deduction, perhaps at $15,000 per year.
But the real "subsidies to the affluent" are cutting subsidies to sugar, corporate farms, oil companies, and big fat defense firms. The problem is not a misallocation by ability to pay, but rather straight up subsidies to war pigs, farm pigs, and the prison-industrial complex fattening the purses of anti-drug warriors. Those payments dwarf the tax cuts.
Taxes take money from people who have earned it. Subsidies are gifts of money from those taxpayers to people who have NOT earned it. Get rid of the subsidies, first.