Legislation & Lobbying

Deficit Panel's 'Starting Point' Plan Seeks to Ax Mortgage Interest Deduction & Cut Social Security

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In a “starting point” plan, a bipartisan presidential commission asked to come up with possible ways to deal with the federal deficit is proposing to slaughter a number of sacred cows, including the home mortgage interest deduction that now applies on income tax returns.

A draft released today also calls for a reduction in social security benefits, except for those who most need the retirement income, a doubling of the federal tax on gasoline and the implementation of a tax on employee health-plan benefits, reports the New York Times in a lengthy article.

The plan will ignite a political firestorm, predicts the Wall Street Journal.

“We have harpooned every whale in the ocean, and some of the minnows,” said former Sen. Alan Simpson (R-Wyo.), who co-chairs the group with Erskine Bowles, who served as a White House chief of staff in the Clinton administration. “No one has ever done that before.”

Additional coverage:

Bloomberg: “U.S. Debt Proposal Would Cut Social Security, Taxes, Medicare”

Washington Post: “Deficit panel leaders propose curbs on Social Security, major cuts in spending, tax breaks”

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