Chattanooga’s Bob Corker has probably never been content tinkering with small problems and little ideas. He’s always been a builder with a bigger vision.
He started his working life as a construction worker, built a construction business, rose to become the city’s largest property owner, went on to become a widely regarded state finance commissioner, and then became this city’s renaissance/water-front building mayor. Since taking over a U.S. Senate seat in 2007, he has quickly forged a reputation for tackling the largest challenges in Washington.
There he has entrenched himself in the most important committees working on the biggest problems: foreign policy, armed services and the wars in Iraq and Afghanistan; financial regulation, banking reform, auto company bailouts and the fallout of the Great Recession; housing and urban affairs.
The problem: federal debt
Now, he’s targeting the mother of all legislative problems and battles — the United States’ federal debt. It now stands at $13 trillion, a figure equivalent to 62 percent of gross domestic product. At current projections, it will rise to 146 percent of GDP in just the next 20 years. Such a debt-to-GDP ratio would easily outpace Greece’s current crisis percentage.
That’s flatly unsustainable.Corker, like every other elected official in Washington, knows it. Unlike most others, he’s developed a zeal for slaying the deficit dragon. In the August recess he went to 26 counties — including Hamilton — to present his power-point slide show on the debt issue and build support for his new mission.
Frightening trends
The trends he cites track those of other deficit hawks. By 2020, the presently projected gap in Washington’s revenue and spending could hit $1.25 trillion a year. The pie-chart chunks of federal spending would shift dramatically: Interest costs on debt would soar — from $187 billion in 2009 to $916 billion in 2020 — and discretionary spending (i.e., defense, highways, education) and mandatory spending on entitlements (Social Security, Medicare, Medicaid) would shrink proportionally.
Corker is reasonably alarmed by such trends. Disproportional debt, and its resulting interest costs, not only consumes savings, starves critical public programs and piles up crushing burdens for our children to struggle under. It also destabilizes the nation and leaves our fiscal security in the hands, increasingly, of foreign national banks and other alien lenders.
His worries are in good company. The Concord Coalition, a premier bipartisan group of fiscal policy wonks and former elected officials, has just hooked up with the Peter G. Peterson Foundation, headed by David M. Walker, the former U.S. comptroller general who’s written an encyclopedia on the debt, to launch a nationwide “fiscal solutions tour” that will focus on the same issues.
Blame to go around
Corkers approach to the debt problem and how to solve it may be unique, however. His initial premise is that there’s plenty of blame to go around for the past spending that’s now driving the debt, and that we now need to agree on a solution.
Both political parties, he says, have done their share. We would quibble on that: the Republicans — from Ronald Reagan’s supply-side voodoo economics to George W. Bush’s profligate credit-card doubling of the federal debt, from less than $6 trillion to more than $12 trillion — have far out-borrowed and out-spent Democratic administrations in the last 40 years.
President Obama, by contrast, just walked into the triple whammy fallout of Bush II’s debt binge, plus a huge fall-off in federal tax revenue due to the Great Recession that an unregulated Wall Street unleashed, plus the need to do stimulus spending to keep the recession from crashing into a bona fide depression.
Regardless, the Republicans still won’t agree to drop the top-tier Bush tax cuts for the wealthiest 2-to-3 percent of taxpayers when they expire at the end of this year. Letting that top-end tax (for incomes above $250,000 for a couple, or $200,000 for single taxpayers) expire would alone save $700 billion a year.
Never mind the past
Corker says, never mind. If we argue about the past, we won’t focus on the future and the debt problem that is engulfing the nation.
He’s right. His big idea is to come together in Washington and agree on how much debt we are willing to carry relative to tax revenue, and then fix spending cap as a fixed percentage of GDP.
Historically, the United States’ midpoint tax revenue figure has been around 18 percent of GDP. To reach a balanced budget, spending would have to fall to the same level. The problem is, the 50-year average for spending is now about 20.3 percent.
Given debt and spending priorities already in the pipeline (two credit-card wars, big tax cuts and the recessions tax whammy have already baked big pending deficits), projections are for $6.7 trillion in additional deficits over the next 10 years. (For comparison: the 2010 budget shows current revenue of $2.381 trillion dollars, spending of $3.55 trillion, and a deficit of about $1.2 trillion.)
Working down the slope
Corker recognizes that the nation cannot ratchet down the debt level quickly to a balanced budget without stalling the economy and throwing the country into a deep recession. His goal to develop a target for more sustainable spending — a fixed “cap” on spending at a defined level of GDP — would require a bipartisan agreement on his spending cap to drive budget policy decisions going forward.
If it takes means-testing for Social Security or Medicare, program cuts and higher taxes — in whatever proportion — rational fiscal thinking must take precedence over divisive partisanship, so be it.
Sen. Corker is on the right path. He has prepared legislation that, if accepted, would force such an agreement. Realistically, he doesn’t expect that to happen. But he does want to help change the terms of political debate on spending. The question is whether he can succeed, where others have failed, to persuade enough other people in Congress to look beyond the next election and embrace his mission.
We now know that Social Security tax collection above each year's SSI needs is converted to general revenue and spent. The SSI trustfund doesn't exist. Years of over-payments have been spent on tanks and junkets.
Sen Corker well knows that the biggest budget imbalances are in military and security related spending. That is the runaway train in our budget,but he is yet to acknowledge this biggest single problem in the area to which he professes expertise.
Either tax us for the huge military and other defence related expenses or cut them back in line with other nations defense budgets. Tax us what is necessary for reasonable social services for a developed country.
So far,Sen Corker is being disingenuous about the problems and the solutions. Why? What is his real agenda?
What is his real agenda? Like all other politicians. IT's RE-ELECTION.
Social security: 1-Remove the cap from social security withholding and employer match. 2-Make necessary adjustments to meet current commitments. 3-Raise the full benefit age consistent with the actuarial tables. 4-Prohibit those not contributing from receiving benefits. 5-Phase out social security and allow individuals to invest withholding and employer matched contributions in secure and guaranteed investments. Note: It does belong to the individual, not the government. They moved it to the general fund and gave tax payers an IOU.
Military: Make the military and war cost a separate assessment and adjust it as expenses increase or decrease.
Economy: 1-Reduce taxes and legislatively imposed cost on businesses with less than 10,000,000 profits by at least ten percent. 2-Reduce taxes for employers adding employees for two or more years. 3-Allow companies paying dividends to deduct dividend payments. Note: The company pays taxes on profits before paying a dividend, the investor paid taxes on the money invested to receive a dividend then pays taxes on the dividend. This is like a Madeoff ponzi scheme. 4-Declare a six month tax holiday on income under 250,000 per year. 5-Pass fair tax bill SB-25.
Spending: 1-Reduce each departments employment roll by 20%. 2-Eliminate Non-essential departments 3-Make it illegal for legislatures to meet with lobbyist.
4-Contributions from individuals only not to exceed $100. 4-Eliminate riders and pork in bills. Each spending proposal must be acted on separately.
Mr. Corker is campaigning. His legislation to limit spending to a percent of GDP is a joke. Inflation will make it meaningless and fit the current administration and fed's agenda.
The points made here may not be the best but we should insist on specifics such as this from candidates instead of philosophical rhetoric and the worn out "I will fight for you". We have had enough fighting. Require candidates to have a specific agenda on all critical issues.
Sen. Corker is on the right path. He has prepared legislation that, if accepted, would force such an agreement. Realistically, he doesn’t expect that to happen. But he does want to help change the terms of political debate on spending. The question is whether he can succeed, where others have failed, to persuade enough other people in Congress to look beyond the next election and embrace his mission.
Reply: When we see these projections, Qoute "At current projections, it will rise to 146 percent of GDP in just the next 20 years. Such a debt-to-GDP ratio would easily outpace Greece’s current crisis percentage." it appears that there is not anything being done to get our private jobs back to increase the GDP.
How do we know if what Senator Corker is proposing is correct or not? It would seem he is not suggesting anything abouy getting our trade balance back in line or to bring the private manufacturing base jobs back? Putting the people back to work with private money is the "key." If Government spending is limited to a percentage of the GDP during a deep recession or during another "great depression" when the GDP would be at such a low value, then what could be done by the government to ever get out of the "ditch" the country was driven into? We are certainly not out of this recession yet, and all we can hear from the "Party of NO" is to stop government stimulus spending without putting any pressure on the private global corporations to invest back into the US or to encourage the consumers to stop buying imported goods.
I'd like to see someone running for political office say: I wasn't all that successful in business. I've really never made a good living. I have a dysfunctional family. I haven't been to church in twenty years. I'm going to stay in office as long as I can. I only joined this party for their support. This office is just a stepping stone for me.
He would be truthful and I would vote for him.
He would be truthful and I would vote for him. Username: hambone | On: September 3, 2010 at 11:46 a.m.
Reoly: Finding the perfect elected person
In our system of electing a President or other elected person, there is not anything holding the candidates to their spoken words prior to their being elected, except, the swearing in oath, the Constitution or the persons being honest in their leadership to the voters after they are in their office. Do we expect to have a "perfect person" elected to any office? Most of us know that the perfect person does not exist and there will be mistakes made by the elected persons. Only the News Media and the illusionary expect a perfect person.
There are differences in the honest mistakes made and those mistakes made deliberately by the elected people in producing false information, to “sway,” confuse and divide the voters on who to believe and what is right or wrong. This happened too much in the last administration and even now with the party out of power along with the anti Obama persons. This is not an argument, the facts on the deliberate misinformation are available.
The one thing that is the same today, yesterday and tomorrow is the old joke: "Want to tell when a politician is lying? Watch to see if his mouth moves."
The author is laughable in how she pretends to deliver an analysis of Corker's position from her progressive perspective. Note that the listed "solutions" effectively turn all of the entitlement programs into income redistribution.
I am left wondering if this is in any way an accurate representation of the path Corker is on or is it a self serving distortion like the targets of blame she selects to put forward.
Thinking like this is crushing this country!
"Sen Corker well knows that the biggest budget imbalances are in military and security related spending. That is the runaway train in our budget,but he is yet to acknowledge this biggest single problem in the area to which he professes expertise."
What planet are you on nucanuck? Since Obama took office the budget surplus alone is larger than the entire cost of the Iraq war since it was started. In a decade you can completely eliminate defense spending and you will not be able to balance the budget. Get a clue!
Or login with:
New Account