Ideas

It's crunch time; we are a eight days away from default so we need to get moving.  Democrats don't want cuts to entitlement programs and Republicans don't want higher taxes but the President has it figured out: he doesn't want to deal with this same issue over and over and over so he wants a big package that will cut spending and increase revenue.  How can we get there?

1. Raise the retirement age.  Some people think this is draconian.  I think Americans live longer than we used to and work at jobs that are less physically demanding.  And besides, if you save responsibly you can still retire whenever you feel comfortable, you just won't get a check from Uncle Sam until you turn 68 or 69.

2. Raise the Medicare enrollment age.  Again, sounds draconian, but upping the enrollment age to 66 from 65 saves money.  Obamacare should also help contain healthcare costs, but some members of government - despite their professed crusade against the deficit - aren't interested in controlling those costs.

3.  Raise the floor of the highest tax bracket to a million from $250,000 and then let the Bush tax cuts expire for everyone in that bracket.  Republicans will never do it, but we need the revenue and those people can afford to pay more.  Many of them, Warren Buffett for example, have ASKED to pay more.  If Democrats are willing to make sacrifices to entitlement programs, Republicans need to compromise on revenue.  Taking the super-rich helps close the deficit and does not stifle growth.

4.  Cut defense spending.  Do we really need enough nukes to eliminate life on Earth 5x over?  Can't we just settle on having enough to kill every living thing on the planet once?  And if we can kill every living thing on the planet even 2x, do we really need as many conventional weapons?  The largest tank battle in history was fought in 1943...why don't we trim a few tanks.  How about that amphibious landing vehicle for the Marines?  Let's pay for that so we can use it in reenactments of Iwo Jima since that is the only conceivable reason we would need it.  Seriously Pentagon, trim the budget.  We can still have - and still do have - the world's largest and most powerful military even if we cut defense spending.

5.  Stop subsidizing corn.  That's all that needs to be said.

6.  Stop subsidizing oil companies.  Or, at the very least, mandate that those funds be used to invest in renewable technologies.

7.  Reform the tax code.  There are many things that I am glad to have my tax money pay for: Medicare; Social Security; defense; and other programs.  I am not ok that my tax money is used to giver further tax breaks to people who are rich enough to buy their own jets.  That's really not ok.  Get rid of those loopholes.

8.  Incentivize areas of growth.  I know this involves spending and not cutting, but to really fix the deficit we need to fix the economy and to fix the economy we need to put Americans back to work.  Private companies can and should take the lead in fields such as sustainable energy, but a little push from the government can spur investments and put people to work.  If done wisely, this will pay for itself many times over.

Some of these areas of focus don't amount to much, for example cutting ethanol and oil subsidies only save a little when compared to the size of the deficit, but why waste money?  We need to be linking funds to outcomes.  For that matter we could probably afford to reevaluate our foreign aid packages.

This plan also requires sacrifices from both sides.  Democrats are loathe to reform entitlement programs but we must do so eventually.  Raising the retirement age and Medicare enrollment age are good first steps and buy time for Obamacare to (ideally) help rein in medical costs.  Republicans won't even consider raising taxes, but the additional revenue created by letting taxes cuts on the wealthy expire and reforming the tax code are critical to closing the deficit and do nothing to hurt economic growth.  If each side gives a little, a lot of good could be done.

There are many in Washington today who would gladly embrace such a plan, but as long as the Tea Party gets its way then gridlock will continue as America counts down to default.