Jane Hamsher of FiredogLake calls it the cat food commission and, given its focus on cutting Social Security benefits, it is easy to see why.
The commission’s chairmen — a conservative Democrat tied to the Democratic Leadership Council (otherwise known as Republicans in sheep’s clothing) and a conservative, anti-Social Security Republican — unveiled the broad outlines of a plan they say will slash $4 billion from projected deficits over the next two years.
The plan has its moments — military spending is on the table — but it is unlikely to pass. And it shouldn’t. It represents an assault on the nation’s middle class and seniors, focusing most of the pain on those who need help right now.
According to an initial report in The New York Times, Social Security benefits would be cut for “most future retirees,” though “low-income people would get a higher benefit,” and the plan “would subject higher levels of income to payroll taxes to ensure Social Security’s solvency for at least the next 75 years.”
None of the “savings,” the Times reports, would be used for deficit reduction “reflecting the chairmen’s sensitivity to liberal critics who have complained that Social Security should be fixed only for its own sake, not to balance the nation’s books.” That’s a gross distortion of the liberal position, of course, which is that Social Security is solvent and that minor tweaks are all that are necessary (such as the expanded payroll tax).
Nevertheless, the commission and the Times continue to run the Social Security con, making it a prime target for budget cutters and privatizers. The chances that enough politicians would get behind changes like this and risk the ire of seniors remain thankfully slim, though I wouldn’t put anything past the corporate lackeys who run things.
More significant in today’s presentation, therefore, is the tax code rewrite being proposed. As described by the Times:
The proposed simplification of the tax code would repeal or modify a number of popular tax breaks — including the deductibility of mortgage interest payments — so that income tax rates could be reduced across the board. Under the plan, individual income tax rates would decline to as low as 8 percent on the lowest income bracket (now 10 percent) and to 23 percent on the highest bracket (now 35 percent). The corporate tax rate, now 35 percent, would also be reduced, to as low as 26 percent.
Even after reducing the rates, the overhaul of the tax code would still yield additional revenue to reduce annual deficits — a projected $80 billion in 2015.
Anyone catch that? Lower-income taxpayers will see their rate fall from 10 to 8 percent, but upper-income taxpayers get a much larger break — from 35 to 23 percent. These cuts would be offset by elimination of tax breaks — notably the mortgage tax deduction — that help cut the tax burden of middle class taxpayers.
Without more specifics, it is difficult to see how something like this would benefit the middle class, let alone the poor, though it seems a pretty big win for corporate and high-end taxpayers.
The three-decade framing of this issue as a spending problem has allowed the corporation and their elected lackeys to target so-called entitlement programs and discretionary spending while keeping the need for more revenue off the table.
Paul Krugman sums up the problem with the commission and its report in a blog post here, call it “unserious”:
If you’re sincerely worried about the US fiscal future — and there’s good reason to be — you don’t propose a plan that involves large cuts in income taxes. Even if those cuts are offset by supposed elimination of tax breaks elsewhere, balancing the budget is hard enough without giving out a lot of goodies — goodies that fairly obviously, even without having the details, would go largely to the very affluent.
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