It sure doesn't seem fair. The co-chairs of the National Commission on Fiscal Responsibility and Reform have largely given Baby Boomers—the generation that created the current fiscal mess—a pass on fixing the problem.
One major recommendation from Erskine Bowles and Alan Simpson is to scrap the tax deduction for mortgage interest. That's fine for older Boomers, since many have paid off that debt or have little interest left to deduct. No child credit? Hey, they're (hopefully) out of the house. Boosting the retirement age for Social Security to age 69 by 2075? The Boomers will be dead then. Gradually hiking the federal gas tax by 15¢ per gallon from its current 18.4¢ starting in 2013? Aging Boomers won't be driving much in their dotage. End the employee-sponsored health-benefit exclusion from income taxes? Boomers will be on Medicare.
"The more you protect the Baby Boomers, the more the relative hit has to fall on younger generations," says Maya MacGuineas, director of the fiscal policy program at the centrist New America Foundation in Washington.
When all is said and done, Boomers may end up shouldering more of the burden to pass a sustainable government to future generations. Bowles and Simpson, long-time political operators, have much of official Washington in a frenzy. They've made it clear that bringing the budget into balance and the debt under control mean abandoning cherished positions. "Fairness" toward aging boomers could be a casualty. It's as if they consulted The Prince, the classic exegesis of power politics by Niccolò Machiavelli, before issuing their preliminary recommendations.
"From this arises the question whether it is better to be loved rather than feared, or feared rather than loved," mused the Renaissance scholar in Chapter 8. "It might perhaps be answered that we should wish to be both: but since love and fear can hardly exist together, if we must choose between them, it is far safer to be feared than loved."
Bowles and Simpson have attracted their share of fear and loathing. For instance, Americans for Tax Reform, the antitax advocacy organization headed by Grover Norquist, blasted the Bowles-Simpson plan. The government would be still "spending too much" and the panel ignored how to balance the budget "without raising taxes," it said. The group pointedly reminded more than 235 congressmen and 41 senators that supporting the plan would violate a no-tax-increase pledge that they made to their constituents. Richard Trumka, president of the AFL-CIO, said the co-chairs' scheme for fiscal balance "tells working Americans to 'Drop Dead.'"
The anxious rush to defend familiar positions is why the nation owes Bowles and Simpson a big "thank you." The report has made it clear just how daunting a fiscal challenge the U.S. faces. Anger doesn't cut it, let alone business as usual. "There is no way to get on top of the debt and the deficit with policy changes that are easy or fun," MacGuineas says. "This is about the hard stuff." Adds Leonard Burman, professor of public affairs at the Maxwell School, Syracuse University: "They did a real service. What they came out with is unpalatable to everyone, and now people can get serious negotiating."
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