Wednesday, August 10, 2011

Evening the Score

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Over the past few weeks I've had more than a few conversations with friends about government debt and government spending. But two exchanges really stood out.  In one, a friend and I were discussing tax subsidies -- particularly the deduction for home mortgage interest. I posed the question: "Why do we have the deduction?" Her response: "Why not?"

In the other exchange, a group of friends were discussing an article they'd read telling how student loans for family members of Congressional staff were forgiven with no repayment required. (Note: I haven't read that article or checked its validity.) If that's the case, they said, then all veterans and armed service members should have all their student loans forgiven with no repayment required.

On the national stage this same point of view is taken by proponents of corn ethanol subsidies. "What? Take away the subsidy? That's the same as raising taxes!"

I can't really blame my friends or others for thinking this way. We've been trained by successive Congresses and seemingly endless government programs that we better get ours because they're getting theirs -- whoever "they" are -- whether through direct payments like Social Security, Medicare, and farm supports or indirect payments like home mortgage interest deductibility, charitable contribution deduction, and child tax credits.

The problem is "they" are "us" and our posterity. We've run up nearly $15 trillion in debt getting "ours" and evening the score. We can't pay off the debt in the short run by strangling public finances and ruining the country's credit rating.

But we can plan for the long-term solution by getting our heads screwed on right -- and right now. Instead of evening the score by getting ours, each of us needs to own the solution and take more responsibility for our personal affairs. Instead of going to Medicare as the primary insurer with private supplement insurance, we need to have private insurance with the government as a provider of last resort. Instead of paying more than 10 percent of our earnings into Social Security, we need to fund our own retirement account then use Social Security supplements only if our own account falls short. Instead of tax credits and deductions for a slew of things, we need to make decisions based on our own situation rather than make biased decisions based on what Congress deems worthy.

The solutions to our economy and debt burden are at hand. To put those solutions in place, Congress and "we the people" must stop playing games and stop trying to even the score.