The “Credible Budget Deal”: A Letter from the Future

I got a very strange, but exciting, email today.  It appears to be an email from my future self. It seems to come from sometime in late 2013, but gives some insight into a possible positive future. Here it is:

Bob, Happy Halloween and greetings from the future. It’s me, Bob Baur…you! The iPhone has been acting strangely. Maybe something to do with the solar maximum that’s going on? Had an icon pop up that I’d never seen before that said “Send Message to the Past.” Some new app, I suppose. Isn’t technology wonderful? Anyway, I figured I’d take a couple minutes to type out a message and let you know what’s coming up on the whole federal budget thing.

Remember a few weeks ago (your time), when the fiscal-cliff deal passed and most of the tax cuts got through, but sequestration got pushed forward a couple months? Well that’s all been settled now. Somehow…I can’t tell you exactly…Congress hammered out a credible budget deal. I know, you’re asking “what does credible mean?” I’m pretty sure I can’t tell you everything, but here’s what I can tell you.

No one was really satisfied with where the tax issue got left off; so, there was quite a bit of work done to lower tax rates across the board, both individual and corporate. That was accompanied by a real push to “broaden the base.” It reminded me a lot of 1986, when Reagan’s Tax Reform Act closed corporate loopholes. Oh, there are some special interests that aren’t as happy as they were in 2012, but overall, the effect on the economy has been outstanding. All the work that Congress and the President put in really helped on the revenue side.

On the spending side, it got pretty contentious for a while, but cooler heads finally prevailed and they managed to work out a deal there too. There were some refinements to defense spending, but the big news was getting Medicare and Medicaid spending under control. It definitely took some selling to the public, but once the long-term implications of out-of-control entitlement spending really sank in, even the staunchest Democrats were willing to compromise. They also addressed the new taxes that go into effect with the health care legislation in 2014. Real brilliant solution!

Lastly, Social Security. Turns out what was really needed was a gradual increase to the retirement age and a reduction in the inflation factor. I hope you like hearing about “chained CPI,” because that’s going to be in the news A LOT. They managed it in such a way that those nearest to retirement now would not be affected. All in all, not a bad deal!

Well, there are trick-or-treaters at the door, so I’d better go. Just thought you’d like to hear how things turned out.

Not sure exactly what to make of it, but it sounded good. If I were putting together a credible budget deal, these seem to be exactly the points I’d hit. I can’t decide, though, if this is really a message from the future, or from an alternate reality. After the last round, all the talk of compromise sounds like science fiction.  In the meantime, I’ll keep my eye out for “Send Message to the Past” in the App Store.

  • Patrick Bacon

    Sounds very similar to the Simpson-Bowles plan. I agree with you Bob, this would be a very credible budget deal.