McCain-Flake plan would let taxpayers set aside funds to end debt

Sen. John McCain (R-Ariz.) and Rep. Jeff Flake (R-Ariz.) are reviving a deficit-reduction plan that would let taxpayers tell the government to use much of their taxes to pay off the debt.

Under a proposal they unveiled Thursday, taxpayers would have the choice on their tax returns of directing 10 percent of their annual income taxes to a new debt-reduction trust fund. If Congress doesn't meet the annual deficit reduction equal to the size of the trust fund, then the government would face across-the-board spending cuts. Social Security, military and debt-interest spending would be exempt from those cuts.

“We simply cannot maintain the level of debt that we expect to carry over the next decade without severe economic consequences,” Flake said in a statement. “If Congress won’t tackle the problem, we ought to let taxpayers do it for us."

Similar debt-reduction proposals were made by former Reps. Phil English (R-Pa.) and Bob Walker (R-Pa.) and former Sen. Bob Smith (R-N.H.) when they were in Congress, but they failed to get much traction.

The federal debt is at $13.1 trillion, or roughly 60 percent of U.S. gross domestic product. It’s expected to grow to 90 percent of gross domestic product by 2020. Economists at the White House, the Congressional Budget Office and the Federal Reserve have said that the debt is on an “unsustainable path.”