I balanced the budget easily without doing things that I think need to be done such as eliminating the department of energy, the department of education, slashing military spending by 35%, etc., etc.
Increased Revenues
Under the category of "revenue increases", I clicked everything except ...
- Repeal health care coverage
- Add a government run health care plan
- Limit ability to sue doctors
That raised $480 billion in a manner far better than the tax hikes in the fiscal cliff.
Appropriated Spending Cuts
Under the category of "cuts to appropriated spending" I clicked everything except ...
- Allow automatic spending cuts (mutually exclusive with keep spending levels at 2011 levels)
- Prevent military retirees from signing up for cheapest version of Tricare
- Increase passenger fees for airport security
- Finance food and safety inspection with fees on meat and egg processing facilities
That reduced appropriated spending by $191 billion
Entitlement Spending Cuts
Under the category of "cuts to benefits or Entitlements" I clicked everything except ...
- Repeal expansion of health-care
- Add government run health-care plan
- Limit ability to sue doctors
That reduced spending by $445 billion.
Grand Total
- $480 billion in increased revenues
- $191 billion reduction in appropriated spending
- $445 billion reduction in entitlement spending
Pragmatic Approach
The grand total above nets $1,116 billion and a projected $14 billion surplus for 2020.
I was surprised by how easy this was.
It's not that I thought balancing the budget would be difficult, rather I have seen these setups before, and they are typically structured as to require massive, punitive tax hikes.
I was pragmatic.
Readers know I have no love of Obamacare, but the president does. Pragmatically speaking, repealing Obamacare is simply not an option. Also recall that Republicans wanted to close loopholes instead of raising taxes. So, for the most part, I simply closed loopholes.
The compromise (not shown) would have been to raise taxes on those making $1 million or more instead of those making over $250,000. That option, if provided and checked (in addition to everything else I checked) would have made the projected surplus even bigger.
Notice I said projected surplus.
Future revenue assumptions by the CBO are far too optimistic for that surplus to be valid. However, there is ample room to slash military spending, slash student aid, and eliminate entire unneeded departments.
A Bit of Compromise and a Lot of Pragmatism
From all the bitching and moaning in Congress, one might think balancing the budget would be impossible. Instead, all it takes is a bit of compromise and a lot of pragmatism.
Yet, I suppose I may as well ask for world peace because "a bit of compromise and a lot of pragmatism" from this Congress does seem damn near impossible.
Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
"Wine Country" Economic Conference Hosted By Mish
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