Maine news, sports, weather from Portland Press Herald / Maine Sunday Telegram, Portland, Maine

October 25, 2012

In Maine, a broad range of positions on how to cut U.S. debt

By John Richardson jrichardson@mainetoday.com
Staff Writer

Maine's major U.S. Senate candidates disagree strongly over what to do about the growing national debt.

Republican Charlie Summers and Democrat Cynthia Dill mirror the positions of their parties' members in Congress.

Summers says the answer is spending cuts, and he has signed a pledge to oppose tax increases.

Dill wants to collect more taxes from wealthy Americans and opposes cuts to social programs.

Independent Angus King says the parties will have to compromise because any realistic plan must include both spending cuts and tax increases.

The United States is spending $1 trillion a year more than it collects in tax revenue. That deficit means the government has to borrow every year to continue operating, and that has pushed the total federal debt to $16 trillion.

The debt will be one of the most urgent issues facing the new Congress.

Republicans in Congress refused last year to raise the legal limit on the size of the national debt unless Democrats agreed to spending cuts.

Democrats insisted that a deficit-reduction plan end tax cuts for people earning more than $250,000 a year. The tax cuts were enacted under President George W. Bush.

The parties didn't compromise on a deficit reduction plan, and instead delayed the deadline for final action until Jan. 1. If Congress and the president cannot agree on a deficit reduction plan before then, deep across-the-board spending cuts will be automatic -- a process called sequestration. Many experts fear that could send the U.S. economy into another recession.

Here is what the three major candidates have been saying on the campaign trail about the federal debt and deficit:

 

THE INDEPENDENT

King has said that reducing the national debt is a top priority and a moral obligation to the next generation.

He blames partisan gridlock for Congress' failure to contain the deficit and reduce the debt, and says the problem can be solved only with spending cuts and tax increases.

"Yes, we have to cut seriously, but we also need to have some revenues," King said at a forum held this month by the Portland Regional Chamber.

King has cited the Simpson-Bowles Commission's debt reduction plan as the right overall approach: spending cuts, simplified tax code, reduced tax rates and the elimination of most loopholes. He also has said he doesn't support all of the details in that plan, such as a gasoline tax.

He supports reducing the corporate tax rate. On the other hand, he says the tax rate on capital gains such as stock sales should be increased to match tax rates on income.

King says he would support ending the Bush-era tax cuts for people earning more than $250,000 a year, but not until the economy is stronger. He favors setting an economic trigger, such as a certain amount of job growth, as a way to remove the timing from partisan politics.

King supports a balanced-budget amendment to the U.S. Constitution, once the current deficit is eliminated, to keep spending in line with revenue in the future.

He has touted his experience balancing eight state budgets, as required by Maine's Constitution, when he was governor from 1995 through 2003.

Republicans have criticized his record as governor.

King cut spending early in his tenure to balance the budget, eliminating more than 1,000 positions in state government, but he oversaw significant spending increases in later years as the economy grew and revenue increased.

Overall, King cut more taxes than he raised, producing a net tax reduction of $429 million in fiscal year 2002-03, according to Maine Revenue Services.

(Continued on page 2)

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