How the Dole-Kemp Economic Plan Cuts Taxes and Balances the Budget
Dollars in Billions
6-Year
1997 2002 Total
If taxes aren't cut, federal tax revenues will be 1498 1875 10072
The Dole-Kemp plan cuts taxes by -12 -129 -548
But people will do less tax-avoiding, and the economy
will grow faster, so the tax cut will be offset by 2 38 147
The net tax cut will be $401 billion, just -10 -91 -401
4% of total federal revenues over the six years
Dole-Kemp revenues will be 1488 1784 9671
Without spending control, federal spending would be 1642 1968 10816
The Congress has already agreed on spending control of 20 126 393
Asset sales will bring in at least 5 6 34
Additional spending control will save $183 billion 8 53 183
over six years. This won't come from Social Security
or Medicare--the Dole plan protects them at the levels
already agreed to by Congress. It comes from other
spending--just a nickel on the the dollar.
Dole-Kemp federal spending will be 1609 1783 10206
The budget balances in 2002 even though overall
spending increases. The Dole-Kemp deficit/surplus
will be -121 1 -535
The Dole-Kemp Balanced Budget--A Summary
1997 1998 1999 2000 2001 2002
Revenues--up 23% 1488 1518 1561 1621 1699 1784
Spending--up 14% overall
Social Security--up 34% 365 383 402 422 444 467
Medicare--up 39% 188 203 213 226 239 248
National Defense 265 264 267 271 270 270
Net Interest 242 244 243 239 238 236
All other spending 549 558 558 569 561 562
Total Spending 1609 1652 1683 1727 1752 1783
Revenues - Spending =
Surplus (Deficit) -121 -134 -122 -106 -53 1
Annelise Anderson
Senior Research Fellow
The Hoover Institution
Economic Adviser, Dole-Kemp '96