October 20, 2014

Budget-Makers, Take Note: Americans Will Tighten Belts

January 26, 2010
Wall Street Journal

Excerpt

It's time to have a broad discussion across the U.S. about the hard choices that need to be made to rein in the budget deficit: The latest Congressional Budget Office forecast and the Obama plan to freeze part of the budget highlight the unsustainability of federal spending.

The good news is that the deficit watchdog Concord Coalition has already started the dialogue. Its findings, especially when it comes to public support for fiscal restraint, may surprise the budget-makers in Washington.

Commentary

Starting in 2009, the coalition has held grass-roots meetings in seven areas across the U.S. (in Atlanta, Iowa, northern California, northern Virginia, Milwaukee, Denver and Philadelphia). Each group looked in depth at the issues confronting the government balance sheets. The coalition found that the more participants learned about the budget, the more urgent they thought the problem was and the more willing they were to accept difficult choices.

The issues are extensive: The CBO forecast Tuesday that the budget deficit will reach $1.3 trillion this fiscal year (which ends in September) and fall to a still-massive $980 billion in 2011.

But politicians in Washington seem almost indifferent to the situation. President Obama has proposed saving only $250 billion over the next 10 years by freezing some domestic programs. As expected, the Senate voted Tuesday against creating a bipartisan commission to devise a debt-reduction plan that Congress would have to vote on.

Voters, however, are becoming very concerned about the deficit's ramifications. According to a recent economic survey done by the Consumer Electronics Association, nearly 60% of respondents said the rising national deficit will have a "major impact" on the prosperity of future generations.

"Politicians may be surprised at how empathetic ordinary citizens are about fiscal responsibility and what solutions they are prepared to consider once they have studied the issues," said Robert Bixby, executive director of the Concord Coalition.

Ideas to pare the deficit included raising the gasoline tax by $1 a gallon, means-testing for Social Security benefits, and requiring legislators to explain how any new program would be financed.

Indeed, "disappointment and frustration with Washington" was a central theme to emerge from the coalition's discussion groups. While President Obama's small plan to freeze spending may be a step in the right direction, the groups preferred "broad sweeping reforms rather than piecemeal efforts," the coalition said.

That's important since a major rethinking of entitlement programs such as Social Security and Medicare will be central to stemming the red ink.

What is needed are serious factual discussions about priorities and tradeoffs, not "Kill Grandma" rhetoric.

"The more people know about programs like Medicare, the more willing they are to discuss serious changes," said Steve Winn, communications director of the coalition. Indeed, one consensus theme in the discussion groups was the need for improving the health-care system, particularly Medicare, which already spends more than it takes in through taxes.

Because entitlement programs are going broke so quickly, participants in the groups came to believe substantial action must be taken now, in order to avoid leaving future generations "a mountain of debt and liabilities," the coalition said.

Unfortunately, Washington politicians don't seem to share that urgency.