Simpson and Bowles included Wyden-Gregg as one tax reform option in their sweeping plan to reduce the federal deficit by $4 trillion through 2020 and hold the federal debt at 60 percent of GDP in 2024, rather than the 100 percent that it will hit under current policy.
The overall plan was attacked by liberals because it extended the Social Security retirement age to 69 (in 2075) and emphasizes spending cuts over revenue increases, but it was praised by budget hawks such as Maya MacGuineas of the Committee for a Responsible Federal Budget.
“It’s a huge, bold plan,” she said, “that changes the discussion forever, as far as I’m concerned. There’s no going back to the nonsense we’ve had before, where the president submits a budget that’s a joke and all we do all year long is come up with policies that add to the deficit.”
She especially praised Simpson and Bowles for demonstrating how rates would rise if various popular tax breaks were retained — up to 13 percent, 21 percent and 28 percent.
One of the key aims of all three plans is, as Simpson and Bowles put it, “to make America the best place in the world to start and grow a business.”
That, in the long run, is the only path to sustained economic recovery, not government stimuli and subsidies.
Another goal has to be political feasibility. Wyden said he and Gregg sought to satisfy both labor and management by ending the subsidy for shipping jobs overseas and lowering the corporate rate to a level that would encourage U.S. businesses to return their foreign profits to this country.
The plan, he said, also replaces “this insanely complicated, job-killing, thoroughly discredited tax system that is not serving America as we try to compete in tough global markets.”
On the Senate floor Tuesday, Wyden said that instead of fighting about the tax policies of Bush and Obama — both of which retain a system in which “the taxpayer loses” — Obama and Congress ought to find a better way, as Reagan and Rostenkowski did 25 years ago.
Vice President Joe Biden waits to conduct a mock swearing-in ceremony with Sen. Brian Schatz, D-Hawaii, in the Capitol's Old Senate Chamber, December 2, 2014. Schatz was sworn in to serve the remainder of his term since he was appointed to the seat after Sen. Daniel Inouye, D-Hawaii, passed away.