The Washington Post

Doing nothing is still an option

Ezra has pointed out before that there’s an uncomplicated way to fix America’s medium-term debt woes. All Congress has to do is … nothing. At the end of 2012, the Bush tax cuts would automatically lapse. As inflation rose, the alternative minimum tax would hit more and more Americans. A whole slew of business tax breaks would expire. And the Sustainable Growth Rate formula in Medicare would trigger large automatic cuts to payments to doctors. Here’s a new chart from Michael Linden:

That doesn’t mean the do-nothing plan is the best way to curb the debt, but it’s certainly an option. Note that even if Congress steps in and tweaks the doctor pay rate (so as to prevent doctors from fleeing Medicare en masse), and decides to index the alternative minimum tax to inflation, the federal debt still drops down to manageable levels. As Linden notes, “Even throwing in the extension of all the expiring business tax breaks would still yield a stable debt-to-GDP ratio at about 70 percent.”

Of course, this only covers the medium-term deficit. Over the long run, health care costs will keep growing and the debt will start rising again, but that’s a somewhat separate problem.


Success! Check your inbox for details. You might also like:

Please enter a valid email address

See all newsletters

Show Comments
Most Read


Success! Check your inbox for details.

See all newsletters

Your Three. Videos curated for you.
Play Videos
Be a man and cry
Deaf banjo player teaches thousands
Sleep advice you won't find in baby books
Play Videos
Drawing as an act of defiance
A flood of refugees from Syria but only a trickle to America
Chicago's tacos, four ways
Play Videos
What you need to know about filming the police
What you need to know about trans fats
Syrian refugee: 'I’m committed to the power of music'
Play Videos
Riding the X2 with D.C.'s most famous rapper
Full disclosure: 3 bedrooms, 2 baths, 1 ghoul
Europe's migrant crisis, explained