July 22, 2014

Guest Commentary: How Would You Trim the Federal Debt?

The following op-ed by Sara Imhof was published in the Detroit Free Press on June 8, 2012

Although the federal budget and its impact on the economy have dominated this year's political debates, elected officials and candidates have largely focused on short-term concerns and what often sound like easy fixes.

A report released Tuesday by the Congressional Budget Office offers a better perspective on the daunting long-term challenges facing the country as retiring baby boomers and rising health care costs put more and more pressure on the federal budget.

"The aging of the U.S. population and the rising costs of health care mean that the combination of budget policies that worked in the past cannot be maintained in the future," the CBO says in its "2012 Long-Term Budget Outlook."

By December, the federal debt is expected to exceed 70% of the country's gross domestic product. In addition, the government has tens of trillions of dollars in unfunded commitments, notably for future Social Security and Medicare benefits.

To keep the debt from climbing to unsustainable levels in the years ahead, the CBO warns, Washington will need to increase federal revenue "substantially above historical levels," decrease projected spending, or do both.

Short-term support for today's struggling economy should be accompanied by plans for comprehensive, long-term fiscal reforms that can be phased in as the economy strengthens. Otherwise we will leave our children and future generations with enormous debt, lower living standards and a diminished U.S. role in the world.

The CBO's long-term projections show how disconnected today's political rhetoric is from the core issues that must be faced. Politicians have been focusing on cuts to domestic and defense programs even though these areas are not the primary source of future pressures on the federal budget.

Meanwhile, elected officials and candidates talk more about extending tax cuts than passing reforms that would broaden the tax base and raise needed revenue to reduce federal borrowing.

There have been other recent warnings about our fiscal challenges. In April, for example, the Medicare and Social Security trustees' annual report underscored the fact that both programs are on unsustainable paths. They had a total cash deficit of $403 billion last year, a number that, absent reforms, will rise rapidly in coming years.

Fortunately, some people are thinking about responsible solutions.

A bipartisan majority of the Simpson-Bowles fiscal commission, appointed by President Barack Obama in 2010, offered many thoughtful recommendations and showed there was room for compromise. Other bipartisan groups have developed constructive suggestions as well. Some courageous members of Congress in both parties have worked hard on plans that would build on these proposals.

The Concord Coalition has found that Americans across the country can sit down with each other to discuss their different views on federal budget priorities and find consensus on ways to slice trillions of dollars from projected deficits.

They do so as participants in "Principles and Priorities," an interactive exercise developed by Concord in which participants assume the role of congressional committees in considering options in all parts of the budget. Many participants say it helps them to hold politicians more accountable.

Concord and U.S. Rep. John Dingell will present one such exercise from 6 p.m. to 8 p.m. Monday, June 11, at the Morris Lawrence Building at the Washtenaw Community College in Ann Arbor. The program is free, but reservations are requested; e-mail greg.sunstrum@mail.house.gov or call 313-278-2936.

Sara Imhof is Midwest Regional director for the Concord Coalition.