The chairmen of President Obama’s bipartisan fiscal commission provide their take on the ongoing debt negotiations and outline a potential way forward in a (lavishly optimistic) op-ed for The Hill. Former Clinton chief of staff Erskine Bowles and former Sen. Alan Simpson (R., Wyo.) begin by reiterating the urgency of the situation. What confronts us, they write, is “the most predictable financial, fiscal and economic crisis we have ever faced.”
Not to fear, however, because to get the economy back on the right track, we just need to pass a “$4 trillion-plus, gimmick-free fiscal consolidation package that stabilizes and then reduces our debt as a share of the economy,” which is similar, but not necessarily identical, to the final report issued by the fiscal commission late last year. As part of a “comprehensive plan, based on the principle of shared sacrifice,” they argue, all aspects of the federal budget should be on the table, from domestic and defense spending to the tax code, “where actual spending is dressed up as deductions, credits and other preferences.” Most critically, congress must do something to address entitlement spending, “the biggest source of our burgeoning debt.”
But doing all of this before is the August 2 deadline is “a tall order,” they write. So Bowles and Simpson recommend a two-part approach: 1) pass a “large down payment” (in the neighborhood of $2 trillion) now, and 2) follow up with further cuts and significant reforms at a later date. The initial down payment should “at least begin to address entitlement growth.” As for the second part, they urge lawmakers to agree to act “before the next election.”
“Elections take all options off the table, instead of setting the table for reform,” they write. “Before the ink even has time to dry on a down payment they might agree upon, our leaders must begin the work to make Social Security solvent, reduce the long-term growth of Medicare and Medicaid, and reform the tax code so it promotes growth and reduces the deficit at the same time.”
I think they left out “and solve the Israel-Palestine conflict.”
Read the whole thing here.