It annoys me that Republicans argue against elimination of special tax benefits for anyone, calling it a tax increase. Let’s get things straight here: tax increases are things that affect everyone.
The tax code needs to be cleaned up, as do subsidies. It is not the proper place of government to be handing out special favors. If the Republicans want to do what is right they need to trade — eliminate a subsidy/tax break that some of their constituents like in exchange for eliminating a subsidy/tax break that the Democrats like. Rinse, lather, repeat, until we are back to something like the Tax Reform Act of 1986, or better.
Much as I am a libertarian, I would like the government to survive after shrinking considerably. Part of that involves paying debts, unless we are thinking of doing an external default. My but the rest of the world, particularly China, would be hurt by that.
Cutting taxes has a limit, unless one wants to see our entitlement programs end. I’m all for that, but I think it is political suicide, because a large portion of the American public believes in magic — they think that they are entitled to a meager pension and healthcare in their old age, whether the government can afford it or not.
Look, I am for cutting the Defense budget bigtime, because it is offense, not defense; we do not need so much to defend us. Fold Homeland Security into Defense. Also cut Social Security and Medicare — we can’t afford them at the level indicated, but not promised… remember that these programs are statutory and not guaranteed.
After that, go after the discretionary budget, and eliminate whole departments. Why do we need an energy department when prices are beyond control? Why do we need an agriculture department when food prices are high, and likely to remain so?
Education department? Things have gotten worse since its creation — eliminate it. HUD, HHS — great big wastes, eliminate them. Commerce, Treasury, Labor, State, Interior, Transportation, Veterans Affairs — cut them in half, and see how they adapt. Make the Fed shrink by 90% or more… what does it take to do monetary policy?
I have no doubt that this policy would make my house price fall, but it is the right thing to do.