A ground breaking way to eliminate the deficit: do nothing

April 23, 2011 in Daily Bulletin

Slate magazine recently presented their own plan to cut the budget deficit. They suggest that the best way to bring the deficit under control is for the government to do nothing. Confused? Read their plan here.

They note that:

Doing nothing means the Bush tax cuts would expire, as scheduled, at the end of next year. That would cause a moderately progressive tax hike, and one that hits most families, including the middle class. The top marginal rate would rise from 35 percent to 39.6 percent, and some tax benefits for investment income would disappear. Additionally, a patch to keep the alternative minimum tax from hitting 20 million or so families would end. Second, the Patient Protection and Affordable Care Act, Obama’s health care law, would proceed without getting repealed or defunded. The CBO believes that the plan would bend health care’s cost curve downward, wrestling the rate of health care inflation back toward the general rate of inflation. Third, doing nothing would mean that Medicare starts paying doctors low, low rates. Congress would not pass anymore of the regular “doc fixes” that keep reimbursements high. Nothing else happens. Almost magically, everything evens out.

It could even generate bipartisan support. Republicans would get to implement a plan that proposes government inaction and nonintervention in addition to cuts to Medicare. Democrats would see taxes return to their old levels and the continuation of the health care bill.

Source: Slate