11.18.2010

Letters to Congress: Deficit Reduction


It's time again for my elected officials to hear from this citizen. This time's topic is deficit reduction. Feel free to co-sign by sending along to your representatives.

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It is my hope that you will do your part to put into action some of the recommendations from the Bipartisan Deficit Commission. It is never a good time to tighten the belt, and interest groups who may suffer if these recommendations are advanced have likely made it known to you in no uncertain terms that now is particularly a bad time to take such action. To them I say: tough luck. And to you I say: show some political courage.

While I am a fiscal conservative, I do not take an extreme position on running a large deficit. The world continues to have faith in our money and our economy, and interest rates are low, so given slack demand and pressing needs, one could make a good case for actually borrowing more, going further in debt, and building lots of things right now.

What I like about the recommendations of the Commission is that they make sense. So it is less about "Chicken Little" and more about doing what is sensible, that I push the following actions:

* A higher retirement age. Social Security was enacted when the ratio of workers to retired was 14 to 1; it is now 3 to 1 and will be 2 to 1 by the time my kids retire. It was also enacted when the life expectancy was barely past 65; now we may expect to live a good quarter of our lives or more beyond that age. And besides, tongue kind of in cheek: we're not France. Some of us actually might want to work into our 60's and even 70's and 80's.

* Lower, broader rates. Interestingly, we are looking at something like that locally here in Philadelphia. Lower, broader rates lead to less distortive behavior, fairer burdening, and more focus on actually doing business rather than avoiding taxes. We all know the tax code has gotten too complicated, and this is one way to simplify it.

* Capping the mortgage interest deduction. This is a highly regressive tax perk, benefiting wealthier people and not a help to any of those low-income households that do not itemize. It has also led folks to buy a little more house than they really need, and we now know what happens when that happens at a national level.

* Upping the federal gas tax. We've spent too much energy (no pun intended) regulating and incentivizing our way to a more sustainable economy and not nearly enough on improving the price signals of consuming carbon. The federal gas tax rate is going on 20 years without even an inflation adjustment. It's time for an environmentally-driven adjustment.

I don't claim to understand the pressures you face to please all of the different constituencies you represent. I realize that politics consists of a series of compromises, and in times like this and on an issue like this, that is all the more true. But I would be remiss if I did not convey where I am coming from. Thank you for your service and attention.


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