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Macomb County lawmakers noncommittal debt commission recommendations

by Candice Miller on December 6, 2010

Saturday, December 4, 2010
Macomb County lawmakers noncommittal on debt commission recommendations
By Chad Selweski
Macomb Daily Staff Writer
Macomb County’s two lawmakers, Reps. Candice Miller and Sandy Levin, remain noncommittal toward the austere spending blueprint that failed to garner enough support to spur quick congressional action.
 
Miller, a Harrison Township Republican, and Levin, a Royal Oak Democrat, both criticized portions of the controversial package, which features a mix of tax hikes and benefit cuts. But they praised the 18-member debt commission that laid out the plan for provoking a national debate about the federal government’s finances.
 
“I think it set the stage for what I hope will be a major debate in the next Congress,” Miller said. “I … think this debt commission was a worthwhile exercise.”
 
Though the bipartisan panel created by President Obama failed to produce a 14-vote supermajority needed for their recommendations to go to Capitol Hill, the group surprised some Washington observers by forging support from 11 participants for the $4 trillion overhaul.
 
“The fiscal commission’s work has shown both the urgency and the complexity of this critical issue and has increased the essential, national conversation that must occur around countless dinner tables as well as here in Washington,” Levin said in a statement. “Now … that they have finished their work, it is my hope that we can take their proposals and envelop them into a broader conversation with new ideas and energy toward solving our critical long-term fiscal deficit.”
 
Levin said the commission’s recommendations failed because they “proved to be imbalanced and unworkable due to the disproportionate burden they would place on America’s seniors and middle- and lower-income families.”
 
Many in Congress blasted several of the recommendations: A gradual increase in the Social Security retirement age to 68 by 2050 and 69 by 2075, doubling the 15-cents-a-gallon gas tax to increase funding for transportation projects, boosting Medicare premiums paid by retirees, using a less generous cost-of-living adjustment for Social Security checks, and increasing the cap on income subject to Social Security taxes. The early retirement age would increase from 62 to 64 along the same timetable.
 
Miller opposes the gas tax and said the commission erred by not addressing the costs associated with health care reform. But the former county treasurer praised the panel’s push for tax simplification.
 
The report calls for eliminating or scaling back tax breaks — including the child tax credit, mortgage interest deductions above a certain level, and deductions claimed by employers who provide health insurance — in exchange for rate cuts on corporate and income taxes.
 
Under one scenario, taxpayers would face three tax brackets of 12 percent, 21 percent and 28 percent. At the same time, taxpayers would still be able to claim standard deductions and exemptions. Capital gains and dividends would be taxed at ordinary income tax rates. Taxpayers could claim a mortgage interest deduction up to $500,000, but only on their primary residence.
 
Unlike many of her colleagues, Miller said she is willing to consider long-term changes in Social Security and Medicare, the largest entitlement programs.
 
“I would say those people 55 (years old) and above should be exempt from all of this because they’re too far along in life to make changes,” she said. “For those below that age, I have an open mind about doing something. What we have now … is just not sustainable.”
 
Even with all of the sacrifices, the plan would fail to balance the budget — leaving a deficit of $421 billion in 2015 — but would stabilize the national debt at an economically sustainable level compared to the size of the economy.
 
The plan received “aye” votes from five of six senators who served on the 18-member panel, chaired by former Clinton White House chief of staff Erskine Bowles and former Wyoming GOP Sen. Alan Simpson. Bowles has warned that Congress must realize that the “era of debt denial” is over.
 
Five of six House lawmakers on the panel voted “nay” to deny it the 14 votes needed to officially deliver it to Congress for a speedy vote. Private sector members supported the plan, saying they’re trying to avert a European-style debt crisis.
 
To reduce projected deficits over the next decade by $4 trillion, the proposal would nearly freeze the Pentagon budget and cut outright the budgets for most domestic agencies. A three-year freeze on federal worker pay was recommended along with the elimination of 200,000 workers – about 10 percent of the federal payroll — through attrition. The panel also called for an end to congressional pet projects known as earmarks.
 
The Associated Press contributed to this report.

http://macombdaily.com/articles/2010/12/04/news/doc4cf988c84bce3946498499.prt

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