Washington Matters


Will Candidates, Voters Tackle the Deficit?


Once upon a time, politicians cared about reducing the budget deficit. They passed laws that attempted automatic spending cuts. They met in private at an Air Force base and hammered out a deal that led President George H.W. Bush to renege on his promise of "no new taxes." Several years later, President Bill Clinton raised taxes again, and Congress was somewhat restrained with spending. The deficit picture brightened and then glowed. The budget started running surpluses "as far as the eye could see."


That was then.

Now with a tide of red ink as far as  anyone can see , no one is doing anything about the amount of debt we are piling up or figuring out how we will eventually pay for it or what problems -- massive problems -- could result. Not Congress, not the current President Bush, not any of the candidates lusting after his job.

 

A small but influential, nonpartisan and ideologically diverse group of Washington graybeards are hoping to change that.

 

Leon Panetta, a longtime House member and Clinton's top budget official, former Republican Rep. Bill Frenzel of Minnesota and a host of others are trying to force fiscal responsibility onto the agenda of the presidential campaign. With financial backing from the Pew Charitable Trust, they are launching "U.S. Budget Watch" for the sole purpose of getting the candidates to discuss the brewing fiscal crisis.

 

It's a tricky business. They all recognize that pushing a candidate to discuss details of, say, a change in Social Security will bring a firestorm of organized opposition and perhaps sink a campaign. "We don't want to put budget control on the agenda and make things worse," says Maya MacGuineas, president of the bipartisan Committee for a Responsible Federal Budget.

 

So, what do these fiscal hawks want?

 

Panetta says each candidate should be asked, "Are you willing to put everything on the table?" That, of course, means each and every spending program as well as higher taxes. Panetta says he would not ask for a plan with specifics, just recognition that everything is under review.

 

The odds against that actually happening would appear steep. But it is an odd election year where candidates are promising to shake things up by addressing problems that have long been neglected. And that's why Frenzel finds some hope. "The public understands that their children, grandchildren and great grandchildren are going to foot the bill" paying the interest on all that debt.

 

But Frenzel's conviction raises an obvious question: If the public understands how daunting this is, how come politicians aren't rushing to fix it?

 

The crisis isn't immediate. The annual federal deficits are relatively small as a percentage of  GDP -- the most reliable way to compare deficits from one era to another. Cutting the spending that Congress has control over would do little to reduce the deficit anyway. The real issue is that as America grays and as health care costs keep escalating rapidly, there will be fewer and fewer taxpayers to pay for Medicare, Medicaid and Social Security and more and more people entitled to what they promise. But because that's seemingly a long time off, everyone is keeping their heads in the sand. The irony, of course, is that the longer the country waits to deal with entitlements, the more the problem evolves into a crisis that will grow increasingly painful to resolve the longer we wait.

 

Lawmakers might be willing to do something about the mess before a crisis hits, but the divisions among voters make any realistic solution politically challenging and even perilous. Let's face it, despite what anyone says, there are ultimately three -- and only three -- ways to seriously resolve the entitlement problem: Cut benefits, raise taxes or do some of both. After years of watching budget discussions and seeing interest groups rally quickly against changes they don't like, it's become clear to me that it takes skill and urgency to sell people on the idea that they should accept changes that will take money out of their pockets.

 

So, here we go again, another group of smart, dedicated people without an ideological axe to grind trying to raise the alarms. Will the message be scary enough for voters to begin thinking about a need to sacrifice now to avoid even greater pain later? Let's see how they and the candidates respond.

 

If you want to see monthly reports on the candidates' campaign policies and plans, visit www.USBudgetWatch.org.




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