So you want to reduce America's budget deficit? Here are your options. 103 of them, to be exact.
The Congressional Budget Office (CBO) estimates that the United States will spend about $6.4 trillion more than it takes in taxes between 2014 and 2023.
Cutting that deficit too quickly, the CBO warns, could "weaken the economy’s current expansion." But if lawmakers are set on ignoring that advice and plan to shrink the deficit anyway — as they seem to be doing — then the report offers a number of concrete options for either cutting spending or raising taxes (or both).
A few highlights at random. The savings listed are for the ten-year period from 2014 through 2023:
— Reduce Subsidies to Fannie Mae and Freddie Mac, $19 billion
— Reduce Social Security Benefits for New Beneficiaries by 15 Percent, $188 billion
— Eliminate Direct Payments to Agricultural Producers, $25 billion
— Eliminate Human Space Exploration Programs, $73 billion
— Eliminate grants to large and medium sized airports: $8.1 billion
— Reduce Size of the Military to Satisfy Caps Under Budget Control Act, $495 billion
— Convert the Mortgage Interest Deduction to a 15 Percent Tax Credit, $52 billion
— Eliminate the Deduction for State and Local Taxes, $954 billion
— Raise tax rates on long-term capital gains and dividends: $53.4 billion
— Impose a Tax on Emissions of Greenhouse Gases, $1.1 trillion
— Increase the Excise Tax on Cigarettes by 50 Cents per Pack, $37 billion
... and so on. Note that the biggest potential savings on the spending side are in health care and defense. And there are a variety of ways to raise taxes.
The full report, with a fuller explanation of all the different options, is here. The summary table is below:
Which of these are the "best" options? That's subjective. There are many economists — Paul Krugman, for one — who argue that we shouldn't be cutting the deficit at all when the economy is still so weak. This is the old debate about "austerity."
The CBO report wades into this debate only briefly, agreeing that hiking taxes or cutting spending too soon would hurt growth, while suggesting that rising debt levels over the long-term are the bigger problem. But the bulk of the report is spent simply laying out all the different budget choices — without much commentary on which options Congress should pick.
Update: A reader notes that this list omits one of the best and most obvious ways to curtail the deficit — faster economic growth.