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April 22, 2010

Balancing act

The new national debt commission will deliver by the end of the year a report on reducing the budget deficit and slowing the growth of the national debt. Are there any ideas the commission can start with?

Dr. Mike Walden, North Carolina Cooperative Extension economist in the College of Agriculture and Life Sciences at N.C. State University, responds:

"There are many, many ideas. In fact, annually the congressional budget office puts out a couple of volumes ... of ideas on reducing the deficit and reducing the rate of growth of the national debt. Let me just hit some of the highlights here. These are not necessarily my recommendations, these are just ideas:

"On Social Security, for example, we could substantially raise the retirement age. We could also change the way in which Social Security payments are adjusted to inflation. That would save billions over future years.

"On Medicare and Medicaid, one idea is to convert those to vouchers so that people then could go out and buy their own insurance rather than as the system works now -- the government, in essence, pays for whatever expenses comes in.

"On various kinds of deductions like the home mortgage interest deduction, one idea is to cap that by income level. The higher your income, the less of a deduction you are able to take.

"The same way with health insurance, which businesses can now provide to their employers and employees -- perhaps put limits on that and the tax deductibility of that.

"The question I think is not are there ideas out there. The question really is which ideas have traction? Which ideas can attract agreement among a diverse group of politicians and really among our diverse population to get adopted and move on these two very important items?"

Posted by deeshore at April 22, 2010 09:02 AM