During the next weeks and months, our nation’s leaders will be focused on our nation’s fiscal health and will be trying to reach agreement on reducing the budget deficit.
But how should they accomplish deficit reduction? Some leaders would cut health care programs like Medicaid, putting the burden on the middle class. But nonpartisan, independent research shows there’s a better way.
What we want to know is what choices you would make. Use our deficit savings generator and help find responsible ways to reduce the deficit. Then, share your custom budget plan with your friends.
Create your custom deficit reduction plan by choosing savings options from the list below. When you’re finished, click “Calculate” and see how much you saved without cutting health care.
Currently, stockbrokers, CEOs, and others who earn much of their livings off investments only pay a 15% tax rate on their profits. That’s significantly less than wage workers who often pay higher tax rates through income and payroll taxes. This option would eliminate this loophole and instead tax this income, known as “capital gains,” as ordinary income, generating $533 billion in savings.
$533 billion
Brand name drug manufacturers drive up prescription drug prices by maintaining exclusive distribution for long periods of time. By stopping drug companies from entering into anti-competitive “pay for delay” agreements and reducing the exclusivity period from 12 years to seven, the federal health program would generate $15 billion in savings.
$15 billion
Prior to 2006, when Medicare Part D (prescription drug coverage) was implemented, the government used Medicaid’s negotiating power to reduce the costs of prescription drugs for “dual eligibles”—people enrolled in both Medicaid and Medicare. However, since 2006, the government has experienced rising costs for beneficiaries. Restoring the rebates the government received through Medicaid for dual eligibles would generate $156 billion in savings.
$156 billion
The Affordable Care Act creates health insurance exchanges where private insurance plans compete to offer the best coverage for the lowest prices. Adding a publically run insurance option to the exchanges would utilize economies of scale and likely offer much lower premiums, generating $104.1 billion in savings.
$104.1 billion
A June 2010 report from a bipartisan group of defense experts recognized hundreds of billions of dollars in savings from the Department of Defense that would not have a negative impact on national security. By gradually reducing military spending in line with SDTF recommendations, holding harmless health care and personnel supports, the country would save $749.3 billion.
$749.3 billion
A significant portion of the yearly budget deficits have come from unpaid for wars abroad. Acknowledging that the country will not continue this trend of massive military spending and capping or eliminating the Overseas Contingency Operations (OCO) budget function would generate up to $1.1 trillion ($1.1 trillion for eliminating OCO after 2013 and $617 billion by capping it at $450 billion over the next 10 years).
$617 billion
Currently, beer and wine are taxed at different measures of volume than hard alcohol. Hard alcohol is taxed by the proof gallon, beer by the barrel, and wine by the gallon. Taxing all alcoholic beverages at the same rate by volume of $16 per proof gallon (approximately $0.25 per ounce) would generate $60.1 billion in savings.
$60.1 billion
A tax on sugary drinks, which contribute to obesity and other health problems, would create both additional deficit savings and an incentive for people to lead healthier lives, effectively lowering national health care spending. An excise tax of one cent per ounce on the manufacture and importation of beverages sweetened with sugar or high-fructose corn syrup would generate $189.7 billion in savings.
$189.7 billion
Currently, the wealthiest taxpayers receive a much larger benefit from itemized deductions than middle-class families. By restricting the tax liability deduction of these filers to 28%, the country would generate $584 billion.
$584 billion
In 2001 and 2003, the Bush administration enacted a wide range of tax cuts, including cuts that dropped rates for those making more than $250,000 per year. Allowing these tax cuts to expire would return rates for upper-income earners to the rates they paid in the 1990s and would return the estate tax to 2009 levels, generating $968 billion in savings.
$968 billion
Oil and gas companies currently receive a variety of tax subsidies for production of fossil fuels. If the special rules for these industries are eliminated, for example, the “intangible” costs write off, the “percentage depletion” allowance, the write off for oil and gas exploration, and the “dual capacity” loophole for fees to foreign governments, the country would generate $38 billion in savings.
$38 billion
After the economic crisis, the government provided substantial assistance to major financial institutions. A new proposal would require large banks to pay an annual fee of 0.17% of the value of their risky investments in order to recoup some of those costs and discourage excessive risk-taking. This would protect consumers against risky trading and generate $61 billion in savings.
$61 billion
Many large corporations paid $0 in taxes in 2011. Some even received money back from the government, meaning they paid negative taxes. If several tax loopholes were eliminated, including the deferral of taxes on overseas profits ($583 billion), the accelerated depreciation of assets ($569 billion), the deduction for domestic manufacturing ($163 billion), Last In First Out (LIFO) rules allowing profit manipulation ($98 billion), and the loophole allowing certain corporations to underreport earned income and avoid payroll taxes ($11 billion), the country would generate $1.33 trillion in savings.
$1.33 trillion
Please select at least 4 savings options from above to finish.
Congratulations! Your custom budget plan generated a ton in deficit savings without cutting health care programs for middle class families.
Make sure your friends and family members know more about the important choices we face in reducing our deficit by sharing your custom plan today.
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