“Simpson-Bowles presents us all with a great opportunity.” ~ Reihan Salam
Indeed it does.
Enough of the right people hate it and enough love it to make me instinctively like the proposal. And it merits much of the positive attention it’s received so far, while much of the dismay over increased retirement age and the like (including wild exaggerations about a war on the New Deal) is little better than melodrama.
Kevin Williamson has a good take on why he supports the proposal:
I think it is equally implausible that a government with a Republican House, a Republican Senate, and Ron Paul/Sarah Palin/Mitch Daniels/Rush Limbaugh/The Ghost of Ronald Reagan in the White House is going to balance the budget with spending cuts alone. Why should I rely on the performance of theoretical Republicans when I have the evidence of actual Republican Congresses and actual Republican administrations to inform me that radical spending cuts are unlikely under a unified Republican government?
Many of the tax reforms are excellent. Simplifying the tax code, while reducing overall income tax rates, makes way too much sense to ever be implemented. But lower income taxes would not only be good stimulus, it would be good for the American economy for years into the future. Meanwhile, wiping out all the pernicious deductions and loopholes would make the tax system more fair and efficient. The mortgage-rate tax deduction would go, creating a level playing field for home-owners and renters, though a phased-out approach is preferable in terms of economic recovery since anything that hits the housing market now could cause ripples throughout the rest of the economy. Likewise, the employee healthcare tax deduction would come to an end, fixing at least one glaring problem with our healthcare system. Even defense takes some pretty significant hits. However, Kevin Drum makes some good points also:
Maybe it’s not serious enough, and maybe it does spend too much time on Social Security reform and perhaps it even cuts too deep into Federal employment levels – but it does tackle some of the worst elements in the tax code and it makes a serious attempt at scaling back defense spending. Furthermore, as Don Taylor notes:
For those of us who mourned the short life and death of Wyden/Bennett, such attention to the employer tax exemption for healthcare is always welcome.
Reducing the deficit and returning to a fiscally sustainable future, with competitive tax rates and a productive private industry, all while keeping the entitlements Americans rely upon intact, is going to take a multi-pronged approach and that’s what the Chairman’s mark attempts to do. It’s not perfect, but it’s not solely aimed at cutting the Federal government down to size as Drum suggests. It doesn’t privatize or eliminate Social Security, and as it stands there’s room to move the reforms toward lower benefit cuts and even a lower retirement age if other compromises are made.
