Letter: Yes, it is a spending problem

For the Monitor

Thursday, January 17, 2013

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The president claims we do not have a spending problem. Our annual revenue collections are $2.2 trillion. Our annual expenditures are $3.4 trillion. Mr. President, we have a spending problem.

The president has condemned tax loopholes that allow corporations to avoid paying taxes, yet his tax increase bill to keep us from going over the financial cliff contained $40 billion in Obama-mandated corporate tax loopholes. Such hypocrisy!

The president refuses to negotiate on increasing the debt limitation. Really! So be it. This past congressional session the Mack-Pence bill was introduced which accomplished two things: It eliminated base-line budgeting and called for a 1 percent across the board reduction each year. Can you imagine the howls of anguish over cutting one penny per dollar to be spent? If kept in place, the budget would be balanced in six years and our debt to GDP would be reduced to a manageable 18 percent.

My suggestion to Congress is to pass an increase in the debt limitation and include Mack-Pence in the legislation. If the president or Senate Democratic Leader Harry Reid have no alternative that includes solutions for debt and deficit, then the ultimate shutdown of government is their fault.

The three bond rating agencies have put us on notice: Solve the deficit problem or face another rating downgrade. Fed Chairman Ben Bernanke has been issuing this warning for some time, only to have the warning fall on deaf ears. If you ask average people on the street who owns the majority of our debt, they will probably answer China – and they will be wrong. It is the Federal Reserve. The proverbial can has been kicked down the road for four years. The time has come to resolve the debt and deficit issue.

ROBERT C. WASHBURN

Concord

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earthling wrote:

18/01/2013

Robert, I have a favor to ask of you: Could you please re-submit any similar letter you may have written back when Bush increased spending, cut tax revenue, nearly doubled the debt, and walked away leaving us with the economy in shambles along with 2 wars and a pile of interest expense bills to pay for? And, while you're at it, can you also re-submit your "spending problem" letter back when Reagan put us on the runaway debt train when he cut the top bracket tax rate to 28% from the previous 50 year average 1932 to 1981 rate of 79%? Thanks, earthling

Van wrote:

18/01/2013

Fantastic Letter, Bob.

Bruce_Currie wrote:

17/01/2013

No, it's a revenue problem. Counter-cyclical deficit spending needs to continue until the economy recovers. Then we can begin to raise taxes to pay for what we should have paid for during the Bush years--two wars and a drug benefit, and a financial collapse that demanded deficit spending to avoid a world-wide financial collapse and depression that would have made the 1930's seem like a minor recession. What is it that conservatives refuse to understand about how we right an economy in hard times? It isn't through "austerity measures", as the Europeans have found out in the past 2 years. By international standards, we are a low-tax nation--total tax burden runs about 26%, compared to OECD rates around 38%. But their economies grow as fast as ours (until the recent round of austerity measures that is). A 10% increase in taxes here would bring in $1.5 trillion, and this amount over 10-12 years would cover the cost of entitlements and wipe out the deficit. What conservatives want is to wipe out the entitlements.