Thank you, John, for your welcome and for hosting this event as well as making available Craig Cohen and Andrew Schwartz whose help has been invaluable.
Thanks to my longstanding partner – Pete Domenici and The Bipartisan Policy Center – including in particular, Steve Bell. Special thanks to my co-chair at The Concord Coalition – Warren Rudman – and board member Evan Bayh – both of whom could not be with us today but who have been partners in planning and chairing this forum. Bob Bixby and his Concord team have been vital to this effort. Bob – we will be hearing from you later, but in the meantime – please accept our appreciation.
This is the first of four forums which have been organized by several organizations that – from a variety of perspectives, believe that America’s current fiscal course is both irresponsible and unsustainable. These organizations beyond Concord, CSIS and BPC include – the American Business Conference, the James A. Baker III Institute of Public Policy at Rice University, the Belfer Center at Harvard University, the Hoover Institution at Stanford University and former CBO Director, Rudy Penner
We are also working in full cooperation with the Campaign to Fix the Debt chaired by former New Hampshire Senator Judd Gregg and former Pennsylvania Governor Ed Rendell and led by the Committee for a Responsible Federal Budget President, Maya MacGuiness.
We are also working closely in this quest for fiscal sanity with David Walker’s Comeback America Initiative and the Peter G. Peterson Foundation’s ongoing and invaluable efforts to call attention to the fiscal challenges that threaten our nation’s future. And finally – I thank all 35 of our former Senate and House colleagues who have signed on to this initiative whose names you can see in your program. We are honored to have with us today: former Senators Bill Brock, Byron Dorgan, and Bennett Johnston and former representatives Bill Frenzel, Dan Glickman, Tim Roemer and John Tanner. You will hear from these colleagues in a few minutes.
Some may ask what brings former members from both political parties together today in the heat of the election? I would answer – our growing concern that our nation is in a perilous fiscal position plus the seeming inability of our political parties to work together. But we are not here to preach doom and gloom and hopelessness because we believe that there are feasible and responsible solutions that we can pursue to protect our children’s future if we work together. To succeed – however – our elected leaders will have to summon more political courage and be willing to engage the public in a genuine dialogue about the magnitude of the challenge and the trade-offs of various solutions. We will hear a lot about numbers in these forums, but this is not complicated calculus or physics. It is about simple arithmetic – addition, multiplication and far too seldom - subtraction. The hard part is making political choices that involve compromise and shared sacrifice. And – it is not just about numbers – it is about honestly discussing our fiscal challenges with our citizens – and taking control of our own fiscal future – before the interest on our debt dominates our choices – and our children’s future – and this day is not far away.
Ultimately, this is a moral issue. Each of us should think about the nation we inherited from our mothers and fathers and ask what we are leaving to our children and grandchildren. From those we now praise as the “greatest generation” we inherited a country with a sound balance sheet that underpinned a growing economy in which children could look forward to being better off than their parents. Unless we act now to bend current trendlines, we will pass along to our children and grandchildren a nation weighed down by unmanageable debt and unsustainable deficits.
Let’s not pretend, though, that this will be easy. Not only are we facing the looming burden of debt. The U.S. and global economy are fragile. So, America faces two challenges if we are to restore prosperity. The economy must grow, which requires private and public investment in skills, knowledge, modern infrastructure, and a pro-growth tax system. The other challenge is that we must put our federal budget on a sustainable path, so that debt is no longer rising faster than the economy can grow.
These two challenges must be addressed simultaneously – we cannot have growth without fiscal stability or fiscal stability without growth. Failure to address the looming debt will weaken the confidence of both consumers and savers and inhibit faster recovery and job growth. But sharp, immediate cuts in spending or increases in taxes – such as those now on automatic pilot on January 1st – will likely push us back into a serious recession.
While this task is politically difficult, it also offers opportunities to create a virtuous cycle – greater fiscal stability would promote economic growth and further growth would increase fiscal stability.
The good news is that we have current members in Congress of both political parties who understand the stakes and who are willing to work together by putting the country first. But, they don’t get support from their leadership in Congress or from the White House.
As we saw at the conventions over the last two weeks, Democrats and Republicans have very different ideas about the role of government and what it should cost. My concern is not so much the difference itself – that’s why we have different political parties – but that the easiest compromise as we’ve often seen is to pay for the Democrats’ vision of larger government with the Republicans’ vision of lower taxes. That is a bipartisan “compromise” we can no longer afford.
There is an old country saying that when the ox is in the ditch you have to focus on how to get it out. In my view, both political parties are spending most of their rhetoric and attention on who drove the ox in the ditch and very little thought about how to get it out.
Even those who believe that their party is 100% right and the other party is 100% wrong have to recognize that there is no chance that one party is going to be able to run over the other and impose its “perfect solution” – certainly not in time to prevent severe damage to our country.
Common sense America must rally and support people who are willing to listen to the other side and find ways of working together. Our elected officials will build bridges if the American people demand it.
It is encouraging that some thoughtful individuals and bipartisan groups have developed a list of reasonable policy options that could stabilize the national debt – encourage economic growth and ensure the sustainability of critical government programs like Social Security and Medicare long into the future by making modest changes now.
Two of those groups produced reports that deserve close attention because of the individuals involved and the comprehensive nature of their recommendations: the National Commission on Fiscal Responsibility and Reform, headed by Alan Simpson and Erskine Bowles, and The Bipartisan Policy Center’s Debt Reduction Task Force, chaired by Alice Rivlin and Pete Domenici. We will hear from these four leaders at our forum next week and of course we have our friend Pete with us today.
Both groups were able to reach agreement on plans that call for shared sacrifice, with substantial changes throughout the federal budget rather than merely some parts of it. Both groups took our fragile economy and short-term economic concerns into account while laying out credible, long-term structural reforms. They put everything on the table. They did not pretend that we can leave Social Security and Medicare untouched and get the ox out of the ditch. They did not pretend that we can increase the defense budget and decrease revenue and get the ox out of the ditch.
In both the House and the Senate, some courageous members of both parties also deserve high praise for their efforts to build upon the Simpson-Bowles and Domenici-Rivlin recommendations. The Concord Coalition will honor 38 of these House leaders at our annual dinner on Thursday, September 20th. Last year, we were pleased to honor Senators Saxby Chambliss and Mark Warner and their Gang of Six for their leadership on this important issue.
To raise awareness about our national fiscal crisis, our Strengthening of America group plans to hold four forums over the next 20 days, concluding before the first Presidential debate.
Today’s session will focus on the global economic and foreign policy implications of America’s debt. I can’t think of any two leaders more credible to discuss this than former Treasury Secretary Bob Rubin and former Treasury Secretary and Secretary of State James A. Baker, III. Pete will introduce them when they join us at 10:30 a.m.
Our next forum will take place Monday afternoon, September 17th here at CSIS, and will consist of two panels.
The first panel next Monday will focus on the national security implications of the nation’s debt. We’ll be joined by former Secretary of Defense Bob Gates and former Chairman of the Joint Chiefs of Staff Admiral Mike Mullen. Secretary Gates will join us via satellite from Washington State.
The second panel next Monday will look at the bipartisan solutions. We’ll be joined by former Senator Alan Simpson and former White House Chief of Staff Erskine Bowles, both via satellite, as well as Pete Domenici and former OMB Director Alice Rivlin here in person.
The third forum will be on Thursday, September 27th in New York City, and will focus on pro-growth tax reform. We will announce the participants and the panel on this subject next week.
The fourth and final forum will return to Washington on Monday afternoon, October 1st. The topic will be health care and entitlement cost control.
That’s what we have scheduled. Now what do we hope to accomplish?
Simply put, we want many more people engaged in understanding the nation’s fiscal crisis inside and outside of Washington.
We want the average American, especially young people, to better understand what is at stake for them if we don’t get this right. These are not table stakes – what we do or fail to do will affect America far into the future.
We want the media to hold candidates accountable and to ask them the tough questions and follow-up questions when their plans flunk basic arithmetic.
We want to support, strengthen, and add to the group of Senators and members of the House of both parties who are willing to work together by putting the country’s future before their political party.
And, we want candidates for federal office to explain how they will work with others to solve this crisis rather than playing “let’s pretend.” Our leaders in Washington can no longer answer the question of what is 2 + 2 with another question – what do you want it to be.
On fiscal matters both parties have a robust political strategy, but America’s future requires a governing strategy.
All of this is essential if we are going to succeed in strengthening America and protect our children’s future.