As Congress and President Barack Obama debate a solution to the fiscal cliff, it should be kept in mind that Obama’s plan to raise taxes for the wealthy would generate only enough revenue to finance just over a week of spending, says Sen. Rob Portman.
"Ending all the upper-income tax cuts would pay for just nine days of annual spending," Portman, R-Ohio, writes in The Wall Street Journal
Entitlements are the real issue, he says. "Social Security and health entitlements will cost 27 times more than the revenue from ending those tax cuts over the next decade."
Almost all of the projected increase in the budget deficit over the next 75 years comes from rising spending on Social Security, Medicare, Medicaid, and other mandatory spending, according to the Congressional Budget Office.
Federal spending already tops its historical average of 20 percent of GDP and is expected to rise to 40 percent within three decades, the former White House budget director says. Much of that gain will stem from 77 million baby boomers joining Medicare.
"Taxes cannot be raised high enough to chase the enormous spending growth projected. The math simply does not work."
Democrats blame the deficit explosion of recent years on the 2001-03 tax cuts for the wealthy. "However, CBO and Tax Policy Center data together show that only 4 percent of the $12 trillion swing from projected surpluses to actual deficits from 2002 through 2011 resulted from the upper-income tax cuts," Portman writes. "Two recessions and soaring government spending were the main factors."
In addressing the fiscal cliff, Congress and the president should "take the opportunity to address the underlying problems causing our steep deficits," Portman says.
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