The Deficit. The Debt. Americans are strangling themselves economically. So:
• Restore all income taxes to the pre-President George W. Bush level, not just those for people earning $250,000 or more.
• Tax the banks $90 billion as proposed by President Barack Obama to pay for their bailout. Then break them up — making them small enough to fail.
You will find these measures repellant, of course, if you’re happy with the estimated $1.6 trillion U.S. budget deficit for the year ending Sept. 30.
Since excessive government encouragement of home ownership contributed to the subprime mortgage crisis:
• Eliminate income-tax deductions for property taxes and mortgage interest.
• Break Fannie Mae and Freddie Mac into four mortgage- buying companies and get them off the federal dole.
You’ll be against these moves, naturally, if you think we can easily afford a budget deficit of $1.3 trillion in fiscal 2011.
Because we need curbs now on out-of-control entitlements:
• Raise the retirement age for collecting full Social Security benefits to 72. Raise the age for Medicare eligibility to 68.
You won’t want to do this, certainly, if you’re delighted that the national debt now stands at $12.3 trillion, compared with $900 billion 30 years ago.
There’s money to be saved on diverse fronts:
• End the wars in Iraq and Afghanistan on the current schedules. Not levying a war tax to pay for these conflicts — which Americans initially would have supported — was a blunder.
• Kill farm subsidies. It’s true that nature can damage farmers. It’s also true that in another industry, a rival’s new product can ruin a company.
Finally: Reduce government.
• Without denigrating what these folks do, does the president really need both a Council of Economic Adviserss and a National Economic Council? The government has both the U.S. Postal Service and the Postal Regulatory Commission. We have a Selective Service System but no draft.
Of course, you will have no problem with these government entities if you’re not worried about the national debt increasing to an estimated $18.5 trillion by 2020. But the noose is getting tighter.
(Pauly is a Bloomberg News columnist.)