An alternative budget plan

You wouldn’t know it, listening to our legislators in Washington, but Americans are more worried about jobs than about the deficit. Polls show they want the government to foster jobs first, then deal with the deficit.

Similarly, if you rely on the mainstream press for information about the debate over the national budget, you may think only two plans are in play, President Obama’s and the House budget bill, both of which are more concerned about bringing down the deficit than creating jobs.

But there’s a third budget plan, a bill written by the 80-member Congressional Budget Caucus, that offers a refreshing alternative that is much more in line with public preferences than either of the others. It’s called the People’s Budget, and it would allocate $1.45 trillion over the next decade to improving the nation’s infrastructure and creating jobs.

And—get this—it would do so while erasing the federal government’s annual deficit by 2021, faster even than the draconian House plan would.

It would do so by raising taxes on the rich and big corporations; holding down health-care costs by creating a public option to compete with private insurers; withdrawing American troops from Iraq and Afghanistan and reducing Pentagon spending; and ending subsidies for big oil companies.

Again, polls show a majority of Americans support these proposals.

Consider, for example, the plan’s call for raising taxes on the wealthy and big corporations. The Institute for Policy Studies, a Washington, D.C., think tank, recently crunched the numbers and found that if corporations and high-net-worth individuals paid the same effective tax rate as they did in 1961 (inflation adjusted), the government would collect an additional $716 billion a year, or $7 trillion over a decade.

As long as Americans don’t know of the existence of the People’s Budget and similar proposals, odds are that the final budget package will be a compromise based on the House’s and the president’s plans, both of which rely primarily on cuts in services to reduce the budget deficit. The loss of services would be terrible in itself, but jobs also would be lost—700,000 under the House plan, according to Moody’s—hurting the weak recovery and adding to the misery this Wall Street-induced recession already has created.