This summer, Congress passed a bill to raise the debt ceiling while simultaneously cutting spending. This bill, possibly one of the most publicized acts of Congress all year, was intensely debated and eventually ended with both parties giving something up.
Around $900 billion will be cut from agencies over the next 10 years and there will be a $900 billion increase in the U.S. borrowing cap come this fall. In addition, a bipartisan committee was formed to cut $1.5 trillion by December. If this “super committee” cannot find the $1.5 trillion to cut, then there will be cuts across the board, including at the Pentagon, among other places.
Although this bill did pass, America’s credit rating was lowered to an AA-plus, with no actual cuts being made to the budget — there were merely cuts intended to be made. The effects of this lower rating will include higher borrowing interest rates, which, in turn, will make it more difficult for the U.S. to loan money from other countries and may possibly raise our debt at a more rapid rate.
The answer to this crisis involves an idea that some see as impossible, however, hard choices need to be made in order to turn this economy around. Specifically, I believe the only solution to our nation’s current predicament is to increase taxes on the wealthy and make deep cuts in our military spending.
Taxes on the rich will begin a road for reconstruction
While this is the stance most liberal politicians are proposing, many conservatives believe that if the wealthy are taxed less, then they will spend more of their money, stimulating the economy. However, this theory has been debunked in recent years as the job market is still very stagnant, as the wealthy are saving their money out of fear of a second recession.
One sign of the rich conserving their money shows the statistics of recent car sales. Car sales are down by 11,000 vehicles per year since 2007, when the economy was at its peak.
Another obvious sign of the nation’s current economic status include the national unemployment rate, which was marked at 9.1 percent as of Sept. 2. This statistic is up by around 4 percent since the economy peaked in 2007.
If I were to tell you that a new tax would be placed on Americans yet the revenue from the money is going to improve our roads, would you agree with it? The problem Americans have with taxes is not paying the extra money, but rather paying the money and not seeing the result. Sacrifices such as imposing new taxes for the national infrastructure should not be feared by Americans, but accepted in order to bring serious change to this nation.
Yet many conservative politicians have attempted to demonize taxes in the past few years. Taxes should not be seen as something that makes Americans cringe, but rather something that must be done in order to keep the U.S. in the pristine condition that it has maintained since its birth.
Military programs provide example of wasteful spending
During the debt ceiling talks, Tea Party congressmen pushed for extreme cuts in the government in programs such as Medicare and Medicaid. Although these proposed cuts would indeed cut spending, economists simply did not know how the nation’s economy would react to such extensive cuts. Cutting programs from the federal government is not a bad idea in itself, but cutting programs to the extent the Tea Party wished was simply too risky and could result in a “double dip,” or second, recession.
Cuts to the government can be made in several sectors such as the Department of Defense. Although national security is of the utmost importance, cuts can be made in defense since the U.S. is currently in the process of pulling troops out of Iraq. National defense accounts for around 25 percent of the nation’s budget. Although we are currently deadlocked in a battle with terrorist regimes, there are still many sectors of the military that could easily be cut.
America spends almost half of the total combined military spending of the world. We can afford the cuts, and, although these may not single-handedly end our recession, it would be a large step in the right direction.
For instance, one of America’s premier fighter jets is the F-22 Raptor. The F-22 is the top of its class and universally-recognized as the best fighter jet for dogfights in the world. The F-22 is incredible at doing almost anything; yet it is not necessary needed for national defense. At about $350 million per unit, this cost could easily be cut since there have been no dogfights in the War on Terrorism; there simply are no enemy planes to shoot down. The F-22 program alone cost the U.S. government around $64.5 billion.
We are no longer in The Cold War, and building up our military by mass-producing fighter jets and tanks is not the answer. Winning the War on Terrorism will come from technology and intelligence, not huge amounts of cash thrown into machinery.
Talk about cutting America’s debt always sounds supportive and must happen before actual change is made for the government. Conservatives have the right idea of cutting the budget but are simply too unrealistic. Democrats plan on cutting the budget at a slower pace to better ensure the stability of the nations economy.
We need to raise taxes to help America climb out of this recession. In addition, unnecessary programs must be cut in order to streamline our out-of-hand spending. If we were to put to use these two propositions, there’s no telling how much our nation could heal from our years of economic despair.
For another view on the current economic crisis, read the Oct. 4 article, Revised spending will decrease nation’s deficit.
