Congressional District 22 Candidates' Answers
on Difficult Economic Questions

1) Scenario: The economist, Lawrence Kotlikoff, published his paper last March that the United States is technically bankrupt; the present value of all of our future obligations is greater than the present value of the revenue we expect to take in plus our current debt (this is based on projections from OMB, Social Security Administration, and Centers for Medicare and Medicaid Services). The Federal Reserve addressed the article in a report that we will be able to avoid bankruptcy — by renegotiating Medicare, Medicaid, and Social Security promises. And in the Gokhale/Smetters Treasury Department’s report, they listed these choices to avoid bankruptcy:
(1) increasing federal income taxes by 74%;
(2) increasing payroll taxes by 103%;
(3) cutting federal purchases by 115%; , or
(4) cutting social security and Medicaid by 47%.
The other option they didn’t explore is to print and circulate more money to stimulate inflation so that we can pay today’s debt with dollars that aren’t worth as much.
Question: As a Representative, what concrete measures do you promote to deal with our bankruptcy threat? Do you plan to raise taxes (if so, which ones, and how much revenue would be raised) or cut programs (if so, which ones, and how much would the savings be) or spur inflation?

2) Scenario: the Federal and some local governments are investigating and starting to implement programs to offer loan assistance or to bail out people who took cash out of their homes to finance their lifestyle and now find themselves owing more than the house is worth with adjustable rates rising. People who bought houses they could actually afford and didn’t use their equity to boost their standard of living are concerned that they will be taxes, since they still have cash, to pay for the first group’s predicament.
Question: As a Representative, would you promote legislation to rescue homeowners near foreclosure so that they do not lose their houses? If so, how much money would you make available, and how would it be funded? And if you protect these homeowners, how do you discourage people, in the future, from recreating the problem under the assumption that the government will bail them out again? If you discourage bills to rescue homeowners near foreclosure, do you promote legislation to prosecute predatory lenders? Do you promote any legislation to assist these people to stay out of bankruptcy? Do you promote legislation to force banks to assume the “toxic mortgage” once they’ve threatened a homeowner with foreclosure and pushed that owner into abandoning the house?

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