Deficit Panel Doesn’t Understand the Problem
The Deficit Commission appointed by Obama to study the nation’s budget problems apparently doesn’t really understand the problem : Sacrosanct tax breaks, including deductions on mortgage interest, remain on the table just weeks before the deficit commission issues recommendations on policies to pare back with the aim of balancing the budget by 2015. The tax benefits are hugely popular with the public but they have drawn the panel’s focus, in part because the White House has said these and other breaks cost the government about $1 trillion a year. At stake, in addition to the mortgage-interest deductions, are child tax credits and the ability of employees to pay their portion of their health-insurance tab with pretax dollars. Commission officials are expected to look at preserving these breaks but at a lower level, according to people familiar with the matter. The officials are also looking at potential cuts to defense spending and a freeze on domestic discretionary spending. It is unclear if the 18-member panel will be able to reach an agreement on any of the items by a Dec. 1 deadline. Even if they do reach an agreement, any curbs on current tax breaks would likely face tough sledding in Congress. The banking and real-estate lobbies have fiercely rebuffed efforts to rescind the mortgage-interest deduction in the past. The panel is trying to seek options for more revenue, but revenue isn’t the problem. Spending is the problem. The US has more than enough revenue. Unless this Commission comes up with tough spending cuts they’re wasting their time, and I can only assume their real purpose is to sell the idea of ending the mortgage deduction and other important tax deductions and keeping Obama and the Dems from taking the blame.
Deficit Panel Doesn’t Understand the Problem
Posted by
on October 25, 2010. Filed under