Under the Economic Policy Institute's plan, jointly written with Demos (demos.org), our debt would increase to 90 percent of GDP. Military spending would be cut by $960 billion over 10 years. People making over $106,000 would pay more into Social Security, but Medicare and Medicaid would not be touched. The plan calls for $84 billion a year more in discretionary spending than President Obama wants -- more for early childhood education, child care, public transit, rural broadband connectivity, and research and development.
EPI and Demos would repeal the George W. Bush tax cuts on high-income people; enact a 50 percent tax on estates worth over $10 million, a financial speculation tax, and a surcharge on top earners; tax capital gains and dividends as ordinary income; and increase the gasoline tax. It's good to hear what liberals would do if they were in power.
Finally, the Heritage Foundation plan is the only one that would actually balance the budget. Federal spending would gradually drop to 18.5 percent of GDP, below the modern average. Heritage would preserve most military spending, but Social Security and Medicare benefits would be phased out for individuals making over $110,000 a year. The eligibility age would rise to 68 and then be indexed to life expectancy.
Heritage would replace all taxes with a simple flat income tax, with deductions remaining for higher education, charitable donations/gifts and mortgage insurance.
As a libertarian, I'm underwhelmed. This year, our government will spend an astounding $3.8 trillion. We need to eliminate entire agencies, departments and missions. None of these think tanks do that.
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