In their appearance at Wake Forest last night, Erskine Bowles and former Senator Alan Simpson presented their long-standing plan for federal deficit reduction and joined their voices to the growing bipartisan chorus reiterating the importance of finding a balanced approach to long-term federal deficit reduction that includes new revenues and targeted spending cuts.
While the Simpson-Bowles plan isn’t perfect, it represents a reasonable starting point for “putting everything on the table” when it comes to federal deficit reduction, and especially the importance of including new revenues. It opens the door to a fiscally responsible alternative to the spending-cuts only approach to budgeting embodied in sequestration—the looming $1.2 trillion in across-the-board spending cuts to federal programs like Head Start, education, R&D, and our nation’s military projected to cost North Carolina thousands of jobs.
Congress should build upon the Simpson-Bowles plan by replacing these sequestration cuts with new revenues created by allowing the Bush tax cuts on incomes over $250,000 per year to expire in January. This approach will negatively affect just 1.4% of North Carolina’s families by reducing their tax cut and will generate more than $1 trillion in new revenues by 2023—an important down-payment on reducing the Federal budget deficit.