A moment of fiscal truth?
The alarming ascent of the national debt over the last 4½ years has created not just economic uncertainty but a pervasive sense of fiscal futility.
But as Erskine Bowles and Alan Simpson, co-chairmen of President Barack Obama’s debt commission, write on today’s Commentary page, America can still change its current course toward bottom-line disaster.
As they also write, though, that will require much tougher political steps than the president or Congress has been willing to take — so far.
Mr. Bowles and Mr. Simpson, who now co-chair the aptly titled Moment of Truth Project, advocate not just spending reductions but “structural reforms” in the federal tax system as necessary moves toward fiscal stability.
And no, despite our former Sen. Fritz Hollings’ relentless appeals for the VAT (Value Added Tax), we don’t see that as a politically palatable solution for what ails Washington’s balance sheet.
These numbers reveal the daunting scale of the red-ink mess:
The then-record $455 billion federal deficit for the 2008 fiscal year was scary enough. Yet deficits in each of the last four fiscal years exceeded $1 trillion. As of Monday, the national debt was a record $16.77 trillion and climbing.
And while current Congressional Budget Office projections peg the shortfall for fiscal year 2013, which ends on Sept. 30, at only $850 billion, that’s still much too high.
The encouraging news is that both parties at least are talking a better fiscal-responsibility game — and that public demand for an overdue corrective action is prompting such assurances.
Indeed, though Democrats have repeatedly stressed not lower federal spending but higher taxes on the wealthy as the best way to trim deficits, President Obama’s latest budget proposal does contain some long-term spending restraints, including cost-of-living adjustments on entitlement programs.
Unfortunately, however, nearly all of those savings are slated for the last few years of a decade-long spending plan. And the president’s insistence on another large tax hike on the rich, coming on the heels of the major increases he got in the year-ending fiscal-cliff deal, renders his approach essentially dead on arrival in the Republican House.
Still, Americans’ rising calls to close the dangerous gap between Washington’s revenues and expenditures are intensifying the pressure on both parties to make the hard spending — and taxing — calls needed.
In their column, Mr. Bowles of North Carolina, former chief of staff for President Bill Clinton, and Mr. Simpson of Wyoming, a former Republican senator, hail a growing public “willingness to be part of the solution” to this defining problem of our time.
Thus, they write, “We hope that instead of retreating to their respective partisan corners, leaders in both parties will work to bridge the divide.”
We hope so, too.
Further postponement of those difficult budgetary decisions won’t just raise the national debt.
It will raise the risks that soaring deficits create for America’s economic future.