Our country is broke. It’s not broke in 30 years or 10 years or 5 years. It’s broke today. A colossal $222 trillion separates the present value of projected future spending and the present value of projected future taxes.
This enormous fiscal gap is the true measure of our nation’s indebtedness. It’s 20 times larger than our nation’s $11 trillion official debt and for a reason. Successive administrations and Congresses have carefully kept almost all of our liabilities off the books using accounting that would make Bernard Madoff blush.
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What I don't understand about these articles that focus on social programs in highlighting this country's indebtedness is why it doesn't include the even more insane waste coming from other sectors, like the military, homeland security, the drug war, Congressional pork, the medical-industrial complex, etc etc etc. Bush waged an 8-year without even mentioning this in the budget, why not focus on this? This has become for me, and for many others, the measure of whether it's a Democrat or a Republican writing the article. The person writing this article is clearly a anti-social, sabre-rattling neo-fascist Republican, 'nuf said.
Corporate tax dodges and fraud?
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Brilliant, but it ain't gonna happen. Most members of Congress, first of all, could not understand this logic; secondly, if they did, do not have the courage to pursue these changes.
Perhaps the professor of my aluma matter can refine these changes into a 5-year plan that achieves what is needed but gets there in a deliberate, patient way.
I hope he does more than write about this, but also works to make it happen. I think that's a problem in this country --- so many experts, so little action.
Without details, this plan is not helpful.
Does the voucher health plan cover 10% of people's health care or 95%? Is the supplemental insurance price regulated? If not, how much do you expect someone 85 years old to pay for the supplement?
Same with the tax structure. WIthout understanding the progressive nature of the taxes, it is hard to make any judgment. Consumption taxes are know to be very regressive. So, what is the progressive scale that protects the poor from the high burden of these taxes? The author may claim his plain is more progressive than the current one, but I am skeptical without the details.
What about defense and other issues?
WIthout those details, this plan is not very helpful. The devil is always in the detail.
Upon further reading, the plan calls for a board of doctors to meet yearly to determine what the health plan coverage that the vouchers will be, subject to the restriction that the vouchers cost cannot exceed 10% of GDP. Since, current health care costs are something like 17% of GPD, that means than individuals will have to make up the rest of the cost, namely 7% of GDP or about 40% of costs at the current level. Beyond that, it does not seem to do anything to bring down the totals costs. It just shifts the costs from employee insurance plans and Medicare to private individuals. Again, the devil is in the detail But it seems, as first pass, that this plan solves the government health care spending by simply transferring it to the individual, much like the Ryan voucher plan for Medicare proposed.
The devil is still in the details, but I am not sold yet.
Funny how all theseaarticles are coming out in the Globe after the election and the fiscal cliff battles. Both sides need to be forced to address this now and wekeeps allowing them to kick itdown the road.
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The author is listed as a Globe Correspondent and Boston University Professor. He is also the author and main proponent of the Purple Plan. This is not just an article, it is an advocacy piece for his plan. He talks in general about non-political economists and concensus views. But this is in fact his plan. Check out the Purple Tax website and you will see his name on the front page as the main person driving this plan. The Globe should have noted this or put it in the editorial section.
It is an interesting plan but a lot more detail is needed. And the Globe should have identified it for what it is.
"And the Globe should have identified it for what it is."
The truth and nothing but the truth.
I think most people still do not understand what is coming...when the "redemption" of Social Security trust fund IOUs starts appearing as a non-negotiable part of expenses along with debt servicing every budget will be a fiscal cliff exercise. These "purple" solutions sound interesting but I don't know how we can get people into a serious discussion until they truly recognize the peril and begin to see the tradeoffs that will be required.
I would love for the Globe to host a panel discussion between Paul Krugman, James Galbraith, and Laurence Kotlikoff. It would be interesting to hear what kind of common solution (if any) the three of them could agree upon.