We don't have a "spending problem" or a "revenue problem" in America. We have a "spending outpacing revenue" problem.
Think of it like a household budget. If you find yourself in an avalanche of debt, what do you do?
Sure, you can cut back on unnecessary spending. But that only takes you so far.
You ask your boss for a raise, you work some OT, you take a second job.
You increase revenue.
My proposal is simple......why not argue that tax rates should "float" depending upon our deficit? Very progressive, but across the board. Everyone should feel the pinch.
Now, of course tea-baggers will balk at this. They don't like the idea of taxes ever going up. But this could play really with independents.
Let's say that in FY 2011, we run a deficit of 1.3 trillion dollars. Taxes automatically go up FY2012 to reduce the deficit by 20% (a 260 billion dollar hike). If there's a 1.1 trillion dollar deficit in 2013, taxes are hiked again to reduce that number by 20% (increasing revenue by another 220 billion).
That continues until we're within a tolerance of 200 billion dollars - either deficit or surplus.
If we run a surplus of more than 200 billion dollars, taxes fall to the necessary level that would get us back within that tolerance. If deficits start creeping back up, taxes level out or go back up.
Now, Republicans will say that this does nothing to decrease the size of government or reign in spending. To which I respond, Americans will have as much government as they're willing to pay for.
If we're running a 3 trillion dollar deficit, that SHOULD hurt the pocket of the average American. And that will cause more spending cuts, which will in turn lower the deficit.
On the other hand, Republicans should LOVE the idea. It prevents us from running wild deficits, it keeps deficits in the minds of the tax payers, and it prevents us from running huge surpluses - that money goes back to the people. Good Reaganomics right there.