The chairs of a major study commission on our nation's fiscal future say it's time for political leaders and the electorate to come to grips with the tough choices and votes needed to put the country on a sound economic path.
The Hill, March 3, 2010
Americans deserve more credit for their willingness to work together toward a brighter future. Apparently, neither the president nor congressional leaders believe that the American people can handle difficult news and will support responsible actions.
America, here are the facts:
We’ve made promises that we cannot afford to keep. The taxes we now pay to finance Social Security, Medicare and Medicaid simply won’t be enough to cover the costs of their future benefits. There are two reasons. The first is that people who are aged 65 and over are the fastest growing proportion of the population. That means there will be many more people retired and drawing benefits relative to the number working to pay for those benefits now.
The second is the rising cost of healthcare. Although part of the projected increase in the costs of Medicare and Medicaid is due to the growth in the number of older people drawing benefits, more of it is due to the continuing high rate of growth of per capita healthcare costs.
If we take action soon, we still have a wide range of reasonable choices. All will require sacrifices — tax increases, future benefit levels lower than envisioned, or, more likely, both. If we wait too long, an economic crisis will be all but inevitable and the options far more painful.
We recently co-chaired a non-partisan committee of 21 experts on our nation’s fiscal future organized by the National Academy of Public Administration and the National Research Council of the National Academy of Sciences. Our committee report, “Choosing the Nation’s Fiscal Future,” describes the fiscal challenge we face, outlines its causes and sets a measurable target for fiscal sustainability (a debt-to-GDP ratio by 2022 of 60 percent, or about what it will soon be), and identifies realistic ways to achieve that goal. Simply put, the report sorts out the work that we must do together to secure the fiscal future of our nation.
We are disappointed that the president’s 2011 budget proposal does little to address the growing debt that threatens America’s future. Under the president’s proposal, using fairly optimistic assumptions about the future performance of the economy, the debt-to-GDP ratio would grow to 77 percent over the next decade and would be heading into even more dangerous economic waters thereafter.
The president’s proposed freeze on non-security discretionary spending is a small drop in a very large bucket. Filling the rest of our long-term debt bucket, and addressing the fiscal challenge posed by Social Security, Medicare and Medicaid, is a job that will be handed over to a new bipartisan fiscal commission — a move that appears more symbolic than substantive.
It’s time for our political leadership — on both sides of the aisle — to give Americans credit for understanding that there are no painless solutions. And it’s time for the American people to give credit to political leaders who are willing to step up to the challenge.
From John L. Palmer and Rudolph G. Penner, co-chairmen, Committee on the Fiscal Future of the United States, Washington