Second, the economic model that you are trying to follow-supply-side, monetarist economics-does not work. It never has, it never will. If it did, the last ten years of reduced taxes for the wealthiest Americans should have this nation in an unprecedented era of prosperity. The problem is, if you reduce taxes too much, the rich tend too flitter it away, just like anybody else. Wealth does not give one superior virtue despite what the rich seem to think. On the contrary, it seems to make things worse simply because you have so much more to waste. Comedian Robin Williams once stated that cocaine was nature's way of telling you that you are making too much money. So are high-risk stock market or other investments that lead to economic bubbles that rip the rest of the economy apart when they burst.
Third, much of our budget shortfall can be laid at the doorstep of the worst economic slump since Herbert Hoover. He and his Secretary of the Treasury, Andrew Mellon, attempted to use monetarist economic plans such as you suggest, to pull us out of the Great Depression. They did not work then, they will not work now. Anyone who has ever read ancient history (Tacitus's Annals on the reign of Tiberius to be precise) knows that the only way to pull a nation out of an economic downturn as severe as the one we are now experiencing, is to use government programs to "prime the pump," to provide jobs for the out of work millions so they will start spending again.
Orrin Hatch railed last week against the almost fifty percent of the U.S. population who do not pay Federal Income Tax. These unheralded fifty percent pay lots of other taxes, including the majority of the FICA tax, most state income taxes, the gasoline tax, etc. Senator Hatch is a classic elitist who, if he reads this article, will probably accuse me of "class warfare." That has always been the way of the ruling class in this country: they invariably scream "class warfare" the loudest while practicing it the most assiduously against the poor, working, and middle classes.
However, certain people, ignorant of history, try to grab onto statements like Senator Hatch's as justification for reworking-i.e., destroying-Social Security, Medicare, Medicaid, and every other program that aids the least fortunate among us into a useless piece of crap.
I cannot honestly believe that any human being with a conscience wants America to return to the way things were before the New Deal, as I described in my January 18, 2009 OpEdNews article "The Forty Percent Solution:"
"At the beginning of the Twentieth Century, it has been estimated that fifty-six percent of Americans "could not make ends meet," i.e., lived in poverty (Stanley Lebergott, The American Economy: Income, Wealth and Want, 1976; p. 508) . In 1928, that number had fallen to an estimated fifty percent (from the late Steve Kangas's web site Liberalism Resurgent: Myths About Welfare; Welfare increases poverty; derived from Internal Revenue Service data cited in Donald Barlett and James Steele, America: Who Really Pays the Taxes; Simon & Schuster, 1994; pp. 66-7) ."
The New Deal got that number down to 22.2% in 1961 (in spite of the intervening Great Depression), when JFK took office. LBJ's Great Society programs had reduced it to 11.1% in 1973, when the first OPEC oil embargo, and the economic aftermath of Vietnam, wrecked our economy until 1983.
As far as I'm concerned, the Big Three--Social Security, Medicare, and Medicaid--are not only inviolate, but are part of the solution to our current problems. Robert Reich points out in his blog article "Mr. President: Why Medicare Isn't the Problem, It's the Solution," that "The real problem is the soaring costs of health care that lie beneath Medicare. They're costs all of us are bearing in the form of soaring premiums, co-payments, and deductibles.
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