In other words, tax cuts for 2%, austerity for everyone else!
Social Security cuts:
- Index the retirement age to longevity — i.e., increase the retirement age to qualify for Social Security — to age 69 by 2075.
- Index Social Security yearly increases to inflation rather than wages, which will generally mean lower cost of living increases and less money per average recipient.
- “Increase progressivity of benefit formula” — i.e., means test part of Social Security benefits by 2050.
- Increase the Social Security contribution ceiling: while people only pay Social Security taxes on the first $106,800 of their wages today, that’s only about 86% of the total potentially taxable wages. The co-chairs suggest raising the ceiling to capture 90% of wages.
- The co-chairs suggest capping both government expenditures and revenue at 21% of GDP eventually.
- In their first plan, called “The Zero Plan,” they suggest reducing the tax brackets to three personal brackets and one corporate rate while eliminated all credits and deductions. Without any credits or deductions (including the ETIC and mortgage interest deductions), the 3 tax rates would be 8, 14 and 23 percent.
- In their second plan, they would increase the personal deduction to $15,000, create 3 tax brackets (15, 25 and 35%); repeal or significantly curtail a number of popular tax deductions (including the state and local deduction and the mortgage interest deduction); and eliminate other tax expenditures.
- The third plan would force Congress to undertake comprehensive tax reform by 2012 by raising taxes for each year Congress fails to act.
- All their proposals limit Congress to collecting taxes on income made within the United States, reducing or eliminating taxes on American expats and revenues companies earn abroad.
- They also suggest raising the federal gas tax to 15 cents per gallon in 2013.
Discretionary spending cuts
- Freeze federal worker wage increases through 2014; eliminate 200,000 federal jobs by 2020; and eliminate 250,000 federal non-defense contractor jobs by 2015.
- Establish co-pays in the VA medical system and change the co-pays and deductibles for military retirees that remain in that system.
- Eliminate NASA funding for commercial space flight.
- Require the Smithsonian museums to start charging entrance fees and raise fees at the national parks.
- Eliminate funding to the Corporation for Public Broadcasting — which many conservatives suggested in the wake of the firing of former NPR contributor Juan Williams.
- Reduce farm subsidies by $3 billion per year.