Columbus Dispatch...
DEBT REDUCTION - No solution
President’s proposals are aimed at re-election, not serious debt reduction 

The problem the nation faces is a federal government that spends money at a rate that is unsustainable. 

The solution that President Barack Obama outlined in recent speeches is to have the government spend even more money, then tax Americans harder to pay for this increase, while leaving the biggest element of the problem — entitlement spending — virtually untouched. 

The president’s recent proposals don’t begin to reduce the vast bulk of the problem: the $14 trillion national debt and the $43 trillion in unfunded liabilities faced by Medicare and Social Security. 

In fact, even if all of the president’s proposals for tax cuts, tax increases, spending cuts and spending increases (yes, the approach is that contradictory) were enacted, the national debt still would continue to grow by trillions of dollars over the next 10 years and entitlement spending would continue to   grow at unsustainable rates. 

In short, the president is offering no serious plan to address a fiscal situation that is a profound threat to the future of the nation’s economy and its standard of living. 

Instead, his recent speeches are calculated to enhance his   chance at reelection. Among the offerings is his proposal for $447 billion in additional stimulus spending. As with the first stimulus, billions of dollars are aimed at preserving the jobs of teachers, who are among the most loyal and generous of donors to the president’s own party. He also has been stoking class warfare by painting the wealthy as shirking their duty to help the nation pay its bills. He denies this, claiming that his proposals simply reflect arithmetic. But arithmetic is not his strong suit. 

The Dispatch previously has noted an analysis by the National Taxpayers Union of 2008 tax returns showing that the top 1 percent of income-earners — those making more than $380,000 — paid 38 percent of all income-tax revenue that year.   The top 5 percent, those making $159,619 or more, paid more than 58 percent of all income taxes. The top 10 percent, which includes those making more than $113,000, paid almost 70 percent of the total income-tax revenue collected by the Internal Revenue Service. 

This is shirking? 

Meanwhile, the bottom 50 percent of income earners, those making $33,048 or less, paid just 2.7 percent of all income tax collected. A study by the Tax Policy Center found that about 45 percent of households, 69 million, paid no income tax   for 2010. While it’s true that many of these households paid Medicare, Social Security, state and local taxes, they are benefiting from, but not helping to pay for, the rest of the nation’s vast spending. 

There may be reasons why this division of the tax burden is justifiable, and proposals to overhaul the tax code entirely are well worth consideration, but there is no basis on which to accuse high-earners of shirking. 

In his speech on Tuesday, the president called for doing away with subsidies and other favors for oil and gas companies. 

That proposal might have merit, but at least those companies actually produce energy for the nation, unlike Solyndra, the solar-panel manufacturer touted by the White House as a harbinger of the green economy. The company just collapsed into bankruptcy, leaving taxpayers on the hook for as much as $535 million, thanks to a federal loan guarantee made by the president’s Department of Energy. Subsidies such as the one for Solyndra also deserve the president’s attention. 

The president did offer to cut $248 billion from Medicare, but not through reforms such as raising the age of eligibility. This is a retreat from his position in July, when he offered to increase the age of eligibility as part of negotiations about   raising the federal debt ceiling. His current plan also does nothing to address the looming insolvency of Social Security. 

Part of the savings the president claims he’ll make is $1 trillion from ending the wars in Iraq and Afghanistan. Considering that those wars will be brought to an end in any case, that saving hardly counts as an extra effort to repair the nation’s finances. If anything, some of those savings are long overdue, since presidential candidate Obama promised in October 2007 that his first act as president would be to bring the troops home from Iraq. “You can take that to the bank,” he said then. He failed to mention that the check would be postdated.  

When it comes to the nation’s fiscal problem, there is no serious leadership coming from the White House. If there is any leadership to be had, it will have to come from the recently appointed congressional committee charged with cutting $1.5 trillion from the nation’s deficits over the next decade, supported by the 35 Republican and Democratic senators who recently urged the committee to exceed its charge and make far larger reductions in the nation’s debt. 

Committees are not known for vigorous leadership, but in the absence of an alternative, the nation is counting on this one. 

Read it at the Columbus Dispatch