Washington needs to find new ways to reduce spending as well. But instead of cutting Medicare or raising the retirement age for Social Security, there are important steps we can take to reduce the deficit that strengthen our economy. Here are five commonsense ways we can reduce spending or shore-up the deficit – without harming our economic recovery:
1. Cut $20 billion in spending by ending taxpayer-funded subsidies for the five biggest oil companies. The Big Five oil companies made a record $137 billion in profits last year and made more than $1 trillion in profits over the past decade. Every penny more at the pump increases their profits by another $200 million. Meanwhile, taxpayers spend billions each year giving handouts to these mega-corporations. I’m fighting to pass the Close Big Oil Tax Loopholes Act, which would end tax subsidies for big oil companies that are reaping record profits while you pay more at the pump.
2. Save $19.5 billion by closing tax loopholes for companies that ship jobs overseas. Too many Ohioans have seen their jobs shipped overseas. What they don’t realize is that the U.S. tax code provides incentives to companies that outsource. I’m fighting to pass the Offshoring Prevention Act, which closes a costly tax loophole that rewards companies for moving factories overseas.
3. Save $2.3 billion by allowing timely access to generic prescription drugs. Generic versions of biologic drugs – the most expensive subset of drugs on the market – aren’t available until at least 12 years after the patent for a brand-name drug is issued. I’m fighting to shorten this window so that consumers, and the government, can spend less on drug costs.
4. Cut $20 billion in spending by streamlining the farm safety net. There are more than five farm safety net and direct payment programs that are meant to protect farmers against volatile growing conditions or drops in yield. But these resources are not always used where they are most needed, and are not always based on crops that are actually planted. I’ve introduced a bipartisan bill with Sen. John Thune (R-SD) to improve the farm safety net. Our proposal consolidates five separate programs while making the farm safety net program more efficient by reducing overlap with crop insurance, and cutting down on paperwork.
5. Save $23 billion by ending special tax breaks for Wall Street hedge fund managers. Wealthy hedge fund managers can make more than $2 billion each year, yet pay a lower tax rate than most middle class Ohioans because of a special tax break. If hedge fund managers paid the regular income tax rate, we could reduce the deficit by $23 billion over the next decade.
Collectively, these simple actions would save nearly $85 billion over the next 10 years.
Ohio families are making tough choices with their household budgets. It’s time the government does the same for the federal budget.
Sherrod Brown is a United States Senator from Ohio.