The Bright Coast

Progressive Thoughts from San Diego Alums on Law, Politics, and Culture

Drastic Proposals for Deficit Reduction

Posted by brightcoast on November 11, 2010

Article here regarding some drastic proposals to close the $3.8 trillion deficit gap. These include raising the retirement age to 69 over time (perhaps not unheard of for those of us in the legal profession), and introducing a flat, albeit lower, tax rate, whilst simultaneously eliminating any deductions–hence no more mortgage interest payment deductions.

While this may sound shocking, it seems an answer to the constant debate regarding tax law reform on how to simplify the annual hassle of filing taxes. This way although certain behaviors are not being incentivized, and certain individuals may no doubt lose out, it is a no brainer, you fall into one of the three categories. This is probably music to the ears of Federal Income Tax I students.

On raising the retirement, I think the outcome of this policy would result in Americans taking a long hard look at their spending habits, and would force many people to prepare for their retirement. For example, if you know that you want to retire at age 65, but the feds will not support you via Social Security until the age of 69, there is a 4 year period you will have to save up for. This author personally feels that the inadvertent and inevitable consequence of all of the well intentioned FDR support programs is that Americans have come to rely on the government, rather than themselves, and it needn’t be that way. It is perhaps for this reason that we have gotten into this mess. Social Security is definitely something that shouldn’t be done away with entirely, the need must be there to justify the continued implementation, but with the recent mortgage crisis, our country has to bounce back from the credit spending mentality, and focus on what is truly important: that which money (or credit) cannot buy.

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