Maybe I heard this wrong, but if the Buffet tax was implemented, it would only bring in $1.5 trillion of revenue over the next ten years? That........doesn't sound like a lot when you factor in the increase of spending over the 10 years. =\
How much revenue would be collected over the next 10 years if the Bush tax cuts expired for everyone?
http://money.cnn.com/2010/12/07/news/economy/tax_cut_deal_obama/index.htm
The bush tax cuts would cost 3.7 trillion dollars (and that's the conservative estimate, btw) if they continued through the rest of the decade. Since they were extended through 2012 (as mentioned in the cnn link), if congress continues ot extend the bush tax cuts, it will cost 3.15 trillion for the rest of the decade. That's on top of the $2.5-3T they already cost from 2001-2010
What really needs to be done is this:
1. Let the bush tax cuts expire (MAYBE keep the bottom 2 income rates of 10% and 15%)
2. Eliminate the social security wage base. All income should be subject to social security taxation, not just the first $110,100.
3. let the estate tax return to the 2001-2002 levels next year.
4. After the bush tax cuts expire, the long term capital gains rate goes up from 15% to 20% (10% for the 15% income bracket). More than half of all capital gains were earned by the top 0.1% last year. Increase the long term capital gains tax rate to 33% and 35% for the 2nd highest and highest brackets, respectively. That will allow people in those brackets to reduce their tax burden through capital gains, but not to a point below the income or capital gains tax levels for individuals in the other brackets. I personally believe that capital gains should be taxed at a higher rate than income (not because it is inherently evil, but because I believe money earned through labor should not be taxed at a higher rate than money earned through investment. Ever. The capitalist's share of the fruits of the laborer's labor should not be taxed at a lower rate than the laborer's share.), but the suggestion I've made here is a reasonable compromise, I think.
I haven't even touched corporate taxes or loopholes like hedge fund managers being able to classify their wages and other compensation as capital gains instead of income, but this is a good start. Even if congress does nothing with regards to taxes, they can achieve 6-7 trillion in deficit reductions over the next decade. items 1 and 3 are aspects of that figure. Item 4 would probably send that above 10 trillion since the buffet rule only a pplies to millionaires and taxes at a lower rate than my suggestion)
Maybe let the payroll tax cut expire, but I'd like to see how these suggestions do first.