-Achieves nearly $4 trillion in deficit reduction through 2020: 50+ specific ways to cut outdated programs and strengthen competitiveness by making Washington cut and invest, not borrow and spend.
-Reduces the deficit to 2.2% of GDP by 2015, exceeding President’s goal of primary balance (about 3% of GDP).
-Reduces tax rates, abolishes the AMT, and cuts backdoor spending in the tax code.
-Caps revenue at or below 21% of GDP and gets spending down to 22% and eventually to 21%.
-Stabilizes debt by 2014 and reduces debt to 60% of GDP by 2024 and 40% by 2037.
-Ensures lasting Social Security solvency, prevents projected 22% cuts in 2037, reduces elderly poverty, and distributes burden fairly.
It sounds too good to be true, or perhaps to good, as a political matter, to implement.
Ramesh Ponnuru likes parts of the draft but not others. That will be a common refrain, I suspect.
Sen. Judd Gregg likes the draft. But then, he’s a member of the commission.
What are the stakes? According to this presentation by Honeywell CEO Dave Cote, who is also a member of the commission, they are massive:
The debt burden accumulated over the next ten years will sink us. And a decision will get made… one of two ways. One way is to do it now, proactively, and thoughtfully. The second way is to wait until the Bond Market forces us to do it. We can ask Greece what that’s like.