Sections

One of the biggest problems the United States faces is the budget deficit and the national debt. In 2010, the deficit was approximately $1.42 trillion and the national debt stood at a staggering $14.078 trillion. Neither the Democrat nor the Republican parties, however, are serious about addressing the issue. Instead, both parties are using the issue only to gain political advantage. This travesty cannot continue and politicians in Washington need to start telling Americans the truth: The deficit and debt problem will only go away if we both cut spending and raise taxes.

There are ways to be smart about cutting spending and raising taxes without hurting the economy; however, that conversation is unlikely to happen in Washington anytime soon, due to the delusions that politicians in both political parties are under. The Republicans have been discussing the debt and deficit for the last two years yet, until they’re willing to consider targeted tax increases, they are deceiving the American people about their commitment to tackling the problem.

The Democrats, meanwhile, are willing to consider some tax increases but any increase in the retirement age is a non-starter for them, proving that they too are unwilling to make the sacrifices necessary to put the country on a fiscally solvent path. Sadly, both parties are talking about making cuts in the discretionary budget, which is only about 19 percent of the federal budget.

Last year, a deficit reduction commission, chaired by Erskine Bowles and Alan Simpson, urged Congress to freeze federal wages and eliminate congressional earmarks—recommendations it adopted. These changes, however, will only save about $36 billion in 2015. Indexing the retirement age to increases in longevity, medical malpractice reform and simplifying Medicare cost-sharing rules would save about $44 billion per year. All of these cuts are anathema to Democrats, who have called the deficit commission’s recommendations “unacceptable.”

The commission also called for closing tax loopholes that favor industries such as Big Oil, a recommendation Republicans oppose. The commission did not come up with the idea, however, that personal income exceeding $1 million per year should be taxed at a higher rate.

A recent poll by Selzer and Company found that 61 percent of Americans support the idea. Such a tax would raise about $35 billion per year, according to an analysis that statistician Nate Silver did for The New York Times, if income more than $1 million per year was taxed at the current rates for the top income brackets.

Millionaires are not the only ones who should sacrifice; once the recession ends, President Obama should give a speech asking every American to do their part and accept a 2 percent income tax increase for five years. He should make it explicitly clear that every dime the federal government collects from this tax increase would go to balancing the budget or paying down the federal debt.

If we as a country are going to get the deficit under control, everyone will have to sacrifice. Once this recession ends, President Obama needs to be straight with the American people and tell them the facts. There must be budget cuts and there must be tax increases, especially on those who can afford it the most. President Obama is fond of using the analogy of taking a scalpel instead of hatchet to the federal budget. If Congress does that, combined with intelligent tax increases that won’t hurt the economy, the United States can get back on the path to fiscal solvency. Let there be no mistake, once the economy recovers, the United States needs to get real.