BUDGET FIX

http://www.nytimes.com/interactive/2010/11/13/weekinreview/deficits-graphic.html?scp=1&sq=budget%20puzzle:%20you%20fix%20the&st=cse


418BILLION-578BILLION=160BILLION SURPLUS.   TWENTY YEARS IN THE FUTURE IS MEANINGLESS.
 

Eliminate farm subsidies

Many economists argue that farm subsidies distort the workings of the market and largely flow to big agricultural businesses. As the Congressional Budget Office has noted, advocates of reducing the subsidies argue that doing so “could help small farms indirectly, slowing the rate” of consolidation. Supporters argue that the subsidies help preserve the American agriculture industry.

Reduce military to pre-Iraq War size and further reduce troops in Asia and Europe “This option,” according to the bipartisan Sustainable Defense Task Force, “would cap routine U.S. military presence in Europe and Asia at 100,000 personnel, which is 26 percent below the current level and 33 percent below the level planned for the future. All told, 50,000 personnel would be withdrawn.” The option would also reduce the standing size of the military as the wars in Iraq and Afghanistan wind down.

$25 billion

$49 billion

Reduce the number of troops in Iraq and Afghanistan to 30,000 by 2013 Reducing troops by to 30,000 from 60,000 could save an additional $20 billion by 2030.

$86 billion

$169 billion

Reduce the tax break for employer-provided health insurance This option would reduce the tax break for employer-provided health insurance, by slowly adjusting the cap, so that it increases at the rate of economic growth, rather than the growth in health costs – which tends to be significantly faster. Over time, more employer spending on health insurance would be taxed.

$41 billion

$157 billion

President Obama's proposal President Obama's proposal is more agressive than Kyl-Lincoln, but would still cut the estate tax when compared to the Clinton years. The Obama plan would exempt the first $3.5 million from any taxable estate. Any estate above $3.5 million would be taxed at a 45 percent rate. These are the same provisions that applied in 2009, as part of the 2001 Bush tax cut.

$24 billion

$45 billion

President Obama's proposal Capital gains and dividends are now untaxed for couples with incomes below $68,000. For everyone else, the tax rate is 15 percent. This option, proposed by President Obama, would raise the rate to 20 percent for households making roughly $250,000 a year and above.

$10 billion

$24 billion

	Allow expiration for income above $250,000 a year This option would allow the expiration, on Jan. 1, of the Bush tax cuts for the top 2 percent or so of households on the income distribution – those making $250,000 or more. On average, the change would equal about 2 percent of a given household’s pretax income.	$54 billion	$115 billion

Payroll tax: Subject some incomes above $106,000 to tax When the payroll tax – which finances Social Security and Medicare – was created, it covered 90 percent of all income. Today, with a ceiling at $106,800, it covers closer to 80 percent. This option would gradually raise the ceiling, until 90 percent of income was again subject to the tax.

$50 billion

$100 billion

	Eliminate loopholes, but keep taxes slightly higher This option is the same as the previous one – except that tax rates would be cut less, raising more revenue to reduce the deficit.	$136 billion	$315 billion
	Reduce mortgage-interest deduction by converting to credit The benefits of the mortgage-interest deduction (and several other tax breaks) flow mostly to high-income households – because they tend to have larger mortgages and have marginal income-tax rates. This option would reduce the value of some of those breaks to high-income households.	$25 billion	$54 billion

	Carbon tax This option would tax carbon emissions, starting at $23 per ton of CO2. The tax rate would increase at a constant annual rate of 5.8 percent, from 2012 through 2050.	$40 billion	$71 billion
	Bank Tax This option would tax banks based on the size of their holdings and the perceived riskiness of those holdings. Larger, riskier banks would pay more tax, both to discourage them from taking big risks and to help cover the costs of future financial crises.	$73 billion	$103 billion