Mayor Michael Bloomberg weighed in on the nation's fiscal issues this morning at an event in Washington, DC this morning, saying the economy was hamstrung by Federal policies that refused to tackle, in earnest, the nation's debt and deficit issues.
"There is widespread recognition in the business community that we have to make big changes – now – or risk having big changes thrust upon us in the form of further credit downgrades, high inflation, or unacceptably severe austerity that would harm the most vulnerable Americans," the Mayor said in his remarks at the event co-sponsored by the Center for American Progress and the American Action Forum.
"But so long as the Federal government continues running huge deficits, and engaging in kabuki dances every few months about how to fix them, business leaders will be less likely to make major long-term investments that would produce jobs."
The mayor called on the Federal lawmakers to embrace cuts to entitlements and tort reform, as well as ending the Bush-era tax cuts and the closing of tax loopholes. Bloomberg said he supported embracing the Erskine-Bowles commission's proposal, which would, among other things, raise the retirement age for Social Security.
"When you look at Social Security’s underlying numbers, the need for reform is undeniable – especially when you consider that one of every two children born today is likely to live to be more than 100 years old," Bloomberg said. "That’s great news for the next generation. But to support their retirements, we’re going to have to adjust."
The Mayor also said he originally supported temporarily extending the tax, but that the time had come to let the tax cuts expire.
"Opponents will yell and scream about taxes and cuts destroying the economy. But the same people said the same thing in 1993, when President Clinton and Congress adopted those rates as part of a major deficit reduction plan. And I think everyone would agree that turned out pretty well," the Mayor said.
Bloomberg used the opportunity to voice his support for Governor Andrew Cuomo's refusal to extend a surcharge tax on upper-income earners in New York. He echoed the Governor's logic that a New York-only tax on wealth places the state at a competitive disadvantage.
“Not only is it class warfare that divides us when we need uniting, but I think Governor Cuomo is exactly right that a millionaire’s tax will lead people and businesses to leave New York or grow in other places – and we just can’t afford that," the Mayor said.
In the end, Bloomberg said, the measures he outlined would save the US $8 trillion and would balance the budget by 2021.