Monday, May 24, 2010

Balancing the Budget

The Committee for a Responsible Federal Budget has created a useful budget simulation in which you get the opportunity to make the "hard choices" necessary to stabilize total U.S. debt at 60% of GDP by 2018. It's an interesting game. Here's how I did it:


  • Reduce troops in Iraq and Afghanistan to 60,000 by 2015
  • Let Bush tax cuts expire, except that lower-rate cuts are only raised by half (this was forced; I originally tried it keeping all the tax cuts, but the numbers just didn't work out)

Defense & Diplomacy

  • Cut foreign economic aid in half

Domestic Social & Economic Spending

  • Cancel TARP
  • Freeze unemployment benefits at 2009 levels
  • Cut TANF
  • Cut federal funding of K-12 education by 25%
  • Eliminate New Markets Tax Credit
  • Cut federal funding of school breakfast programs

Social Security

  • Raise retirement age to 68
  • Reduce benefits by 30% (over next 70 years)
  • Use alternate measure of inflation for COLAs
  • Reduce spousal benefits by 33%
  • Increase Years Used to Calculate Benefits (from 35 to 40)
  • Include all New State and Local Workers

Health Care

  • Repeal ObamaCare but keep the Medicare/Medicaid Cuts
  • Raise Medicare Premiums to 35% of Costs
  • Enact Medical Malpractice Reform
  • Increase Medicare Retirement Age to 67
  • Reduce Medicaid Funding Matches to States

Other Spending

  • Cut Federal Workforce by 5%
  • Reduce Farm Subsidies
  • Cut Earmarks in Half

Tax Expenditures

  • Convert Mortgage Interest Deduction to a 20% Credit
  • Eliminate Biofuels Subsidies
  • Replace Employer Health Care Exclusion with a Flat Credit

In general, my philosophy is to cut the size of government where possible, and keep taxes low where possible. I wasn't able to cut taxes as much as I would have liked, but no doubt that's because of non-discretionary spending.


  1. I'm really with you on a couple of things, retirement age, biofuel, farm subsides (end them yesterday), troop reductions...all good stuff. However,"Cut federal funding of school breakfast programs." Whats your rationale?

  2. @Aaron: Simply that the federal government doesn't need to be involved in this. I'm not opposed to such programs per se. But the centralization of funding leads to centralization of control, and I'm opposed to that.