President Obama is talking about yet another stimulus plan, and this one will include $50 billion in infrastructure spending. On every issue, the left has only two answers: more federal spending and more federal control. Conservatives have not and should not shy away from opposing these policies. But conservatives also must offer an alternative vision of America’s future. One that is consistent with our nation’s founding principles and empowers the people to compete in the 21st century. Today, The Heritage Foundation is releasing just such an alternative: Solutions for America.
Heritage Foundation President Ed Feulner describes Solutions as “a comprehensive guide for getting our nation back on the right track. Some of the policy recommendations are groundbreaking. Others are familiar. Some are being debated right now. They all have two things in common: They return power to the people, and they are all transformational ideas.” For example, Solutions recommends:
Cap Federal Spending: Washington has no enforceable limits on its spending and discretionary spending has nearly doubled since Congress let its spending caps expire in 2002. Congress should enact a firm cap on the annual increase in total government spending, limited to inflation plus population growth. Lawmakers should exert all effort to keep overall federal spending to less than 20 percent of U.S. GDP, the historical postWorld War II average for federal spending.
End the Era of Entitlements: Currently spending on the Big Three entitlements (Social Security, Medicare, and Medicaid) is on autopilot — increasing automatically every year without any budgetary scrutiny. Congress must bring entitlement spending into the congressional budgetary process. We should raise the Social Security retirement age, and encourage people to work longer by eliminating payroll taxes for those over the retirement age. We should let needy families choose how to spend their Medicaid dollars and establish a new Medicare “defined contribution” system as we transition away from todays costly and inefficient fee-for-service system.
Restore Our Free Economy: Our corporate income tax rate, currently the second highest in the developed world, must be cut to restore U.S. competitiveness. The corporate tax rate should be set at or below the Organisation for Economic Co-operation and Development average of 26 percent to eliminate the incentive for businesses and jobs to move overseas. We should also stop taxing businesses as individuals, but rather reduce rates to 25 percent, which would help business to grow and create jobs.
Revive Federalism: Over the course of the 20th century, the administration of government has been increasingly centralized under the federal government. In 1900 almost 60% of government spending took place at the state and local levels. Today, the federal government spends more than twice as much as all other levels of government combined. Washington must cede vast swatches of its policymaking authorityand the funding that goes with itto states willing to reassume leadership in traditional state roles such as transportation, education, health, homeland security, and law enforcement.
Invest in Peace through Strength: A robust military is the surest way to deter aggression and reinforce U.S. diplomacy. To accomplish this, the Pentagon procurement holiday must end. Congress must refurbish our armed forces, especially our depleted Navy fleet and vital missile defenses.
These are just some of the ideas contained in the more than 20 chapters and more than 120 specific policy recommendations contained in Solutions for America. Contrary to what the President says, these ideas are not based on fear, but on faith in the American people and the vision of our nation’s founders. The policies articulated in Solutions are calculated to make that vision a reality, to build an America where freedom, opportunity, prosperity, and civil society flourish.