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Economist's Optimistic View About the U.S. Deficit Ignores the Huge Debt Taxpayers Owe

January 20, 1991

George Perry's article "Deficit Under Control, So Congress Should Move On" (Dec. 23), shows the kind of thinking that continues to get our country in trouble.

What about the interest we continue to pay? The average taxpayer's share of the debt is $30,000, and he/she pays $2,380 a year in interest. Thirteen and a half percent of the government's budget is for interest, and this number is growing. We, the people who let this travesty occur, need to give Congress permission to take substantive steps to lower our interest burden.

We need to pay for the savings and loan debacle, not lay it on our grandchildren. We should allow Congress to create a surtax dedicated to reducing our national debt (a 3% surtax would mean an average of $147 per taxpayer, and assuming a 2% growth in population and 4% inflation rate would, in 30 years, lower each taxpayer's burden to about $11,000).

If we refinanced our debt with tax-free bonds, we would automatically lower our interest charges, create a new market for money (since most government bonds are purchased by tax-deferred vehicles and foreign governments) and we would be less dependent on countries such as Japan for financing our debt.

If we allow Congress to relax the debt and to move on as Perry suggests, we will continue to weaken our infrastructure and our strength as an international leader.

ALAN B. UNGAR

The writer is a certified financial planner in Calabasas.

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