What you are not being told and what we need to do about the federal debt and budget deficits

With all the talk of the federal debt and budget deficits, there is a lot that is not being discussed. Yes, the deficit is huge and worrisome, but we need to hear the truth before we make huge spending cuts that would affect millions.

In 1980 the deficit was less than $1trillion. By the time Bush41 left office, the debt had ballooned to nearly $5 trillion. That was an increase of 500% that was directly attributable to the Reagan tax cuts. Reagan had promised to offset the tax cuts with budget cuts. Those never happened. Republicans claimed that they were hampered by Democratic congresses. However, they could have played hardball and used their filibuster power to push through cuts.

The debt remained around $5 trillion during the Clinton era. However, by the time Bush43 left office, the debt had ballooned again to $10 trillion or an increase of 100%! Again this was attributable in part to tax cuts that were not matched by spending cuts. In fact Bush43 pushed through new spending on two wars, Medicare part D, and the Bank bailout.

Now, during Obama's tenure the debt has increased 40% to nearly $14 trillion. What has alarmed everyone is that this happened in only two years. However, this is due to the Bush43 legacy and the Obama stimulus program. That program is a one-time event. The Bush43 legacy endures.

Since 1960, only two presidential administrations have had budget surpluses: Johnson and Clinton. Republicans won't tell you this.

A mix a budget cuts and tax increases is the best solution for the problem. Budget cuts alone are not politically feasible. Tax increases alone will not reduce the deficits.

Here is what I think we need to do:

• wind down our involvement in Afghanistan and Iraq - get out by 2015
• significantly reduce our overseas military footprint - wean our allies (except perhaps Japan and Korea) away from our military umbrella
• eliminate wasteful and unneeded military programs
• raise the retirement age to 70 and eliminate early retirement for all under the age of 60 - medicare and social security would not be available until age 70, period
• lift the cap on social security and medicare taxes so that all income is taxed - why do only the poor and middle class contribute when everybody can draw benefits?
• means test medicare and social security - those with millionaire incomes should pay a portion of their medicare and get less social security
• raise the federal tax rates to Clinton era levels - there was unprecedented wealth creation during this era at these tax rates
• reduce or eliminate most tax deductions
• eliminate different filing rates for married, head of households single, joint filing etc. - everybody pays individually at the same rates

With the above suggestions we could actually have budget surpluses, be able to pay down the debt, the poor would still have a safety net and the middle class would still get their benefits.