The good news is that we still have time to deal with the deficit problem, but the longer we put it off, the bigger it will become. This problem is not one that can be solved either simply or quickly. It is too large to solve solely with economic growth, or only with tax increases or spending cuts alone. It will take some of all three. Anyone who says with a straight face that we are going to deal with our deficit in a serious way without touching revenue, defense spending, Medicaid and Medicare and addressing the solvency of Social Security is not telling you the truth.
All of us have to make some sacrifices today so that our nation can remain strong in the future. As my friend and partner Al Simpson says, we all have to be prepared to give up something we like to protect the country we love.
That is the approach we took in the Fiscal Commission. Our plan asked for sacrifice from all but the most vulnerable in society. We subjected all parts of the budget to scrutiny and cut wasteful and low-priority spending wherever we could find it. Liberal and conservative Commission members were willing to accept tough choices in areas important to them as long as they saw everyone else willing to do the same with their priorities. Everyone had to swallow hard and nearly choked on one item or another. None of us thought our plan was perfect. But perfection was not the goal. Getting an agreement on a plan big enough to be equal to the challenge was the goal. In the end we were able to get a bipartisan supermajority of the Commission on a plan with $4 trillion in deficit reduction, three quarters from spending cuts and one quarter from increased revenue, which would stabilize our debt and put it on a downward path as a percentage of GDP.
The problem in finding a solution to these deficits has rarely been with the economics, it has been with the politics. Most political leaders know what needs to be done; they just have not been able to summon the collective political will to do it. Any serious bipartisan proposal to deal with the deficit will be savaged by special interests and the defenders of partisan purity on the left and the right. If we in the private sector of the economy allow members of Congress to think that doing nothing is OK, then that’s exactly what they’ll do. All of us in the private sector must put aside our individual wish lists and think about what’s really important for our country. If we’re unwilling to do that, then future generations, and I believe our own generation, are going to be in a world of hurt.