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Jewish World Review May 10, 2011 / 6 Iyar, 5771 A Solution to the Debt Menace By Cal Thomas http://www.JewishWorldReview.com | Here's a safe prediction: The "bipartisan" group of congressmen led by Vice President Joe Biden will fail to solve the $14 trillion debt crisis. Here's another prediction: The Heritage Foundation (www.heritage.org/) has developed a formula, made possible by a grant from The Peterson Foundation (www.pgpf.org/), that could balance the budget in 10 years, reduce the debt to 30 percent of gross domestic product within 25 years, cut the size of the federal government in half by 2036, reform the tax code, restructure Social Security, Medicare and Medicaid, while protecting the most vulnerable, and not increasing taxes if -- and it is a very big if -- politicians prefer the solution to continued bickering. SOCIAL SECURITY: The plan's centerpiece foresees "a gradual transition over many years to a flat benefit system ($1,200 per month in 2010 dollars that would be indexed in future years) to protect seniors from the risk of living in poverty." Higher income seniors would see gradual reductions in their benefits, based on their non-Social Security income. Benefits for single seniors earning $100,000 and couples earning $165,000 would be phased out. The minimum retirement age would increase to 68, reflecting today's longer life expectancy. "Those who work past their full retirement age would receive a special annual tax deduction of $10,000, regardless of income level." The tax on retirement income would be eliminated. The plan would make seniors less dependent on income from Social Security by offering them savings options. "A new savings plan would automatically place 6 percent of a worker's income in a savings plan they own and control, unless they voluntarily opt out of enrollment. This money would not be double-taxed, unlike today's Social Security payments and other savings options." RECEIVE LIBERTY LOVING COLUMNISTS IN YOUR INBOX … FOR FREE! Every weekday NewsAndOpinion.com publishes what many in the media and Washington consider "must-reading". HUNDREDS of columnists and cartoonists regularly appear. Sign up for the daily update. It's free. Just click here. MEDICARE: "Transformed from its current unsustainable and open-ended system into a defined contribution that helps those who need it most." Medicare eligibility would be determined on non-Social Security income, with a similar means testing of allotments. It would be completely phased out "for seniors receiving $110,000 (single) and $165,000 (married)." The program would be put on a long-term budget. All seniors would be allowed to choose from traditional Medicare fee-for-service coverage, as well as expanded options in private plans, ensuring competition and controlling costs. Unlike the current program, the reform would offer catastrophic health coverage as a standard feature in both Medicare and private plans. All of this is linked to full repeal of the euphemistically titled "Patient Protection and Affordable Care Act," which, says the Heritage proposal, "centralizes decision-making over health care services within the federal government, thereby limiting choice and options for affordable care." The Heritage plan proposes to create a health care system driven by consumers, not managed by government. MEDICAID: Tailored to focus on the disabled and vulnerable elderly. "States would be given greater flexibility to experiment with health programs" and would "cap Medicaid spending at 2007 levels." TAX REFORM: A single, flat tax for individuals, lowered overall rates, elimination of taxes on gifts and transfer. All deductions would be eliminated, except for mortgage interest, charitable contributions and education. FEDERAL SPENDING: Non-defense discretionary items would revert to 2008 levels. Federal spending has jumped 21 percent faster than inflation in just the last three years. What's the difference between the Heritage Foundation plan and the one proposed by House Budget Committee Chairman Paul Ryan? Stuart Butler, who headed the team that drew up the Heritage proposal, tells me the Ryan plan "can't balance the budget any time soon. Ours does." Heritage president Ed Feulner says, "We have come to a time of decision. For too long, Congress has been on an unsustainable binge of spending, taxing and borrowing. Our nation is going broke, and we are passing the costs of these misguided politics to our children and their children. America is on the verge of decline -- economically stagnant and permanently debt-bound, heavily regulated and bureaucratic, less self-governing and less free." Knowing what must be done and not doing it is not just irresponsible, but deplorable. The Heritage plan offers a way out if politicians put the welfare of their country ahead of their own. Every weekday JewishWorldReview.com publishes what many in the media and Washington consider "must-reading". Sign up for the daily JWR update. It's free. Just click here. BUY THE BOOK Click HERE to purchase it at a discount. (Sales help fund JWR.). Cal Thomas Archives JWR contributor Cal Thomas is co-author with Bob Beckel, a liberal Democratic Party strategist, of "Common Ground: How to Stop the Partisan War That is Destroying America". Comment by clicking here. © 2011, Tribune Media Services, Inc.

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