Coming crunch: A bipartisan group makes a call for fiscal action
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With the presidential candidates busy making expensive promises to the voters, a distinguished, bipartisan group of economic experts came to Pittsburgh last week bearing news that nobody wants to hear: The nation cannot continue on its current fiscal course.
This warning should be taken very seriously, given the credentials of those making it -- experts like David M. Walker, the former U.S. comptroller general; Alice B. Rivlin, a senior fellow at the Brookings Institution who was the first director of the Congressional Budget Office; and Brian Riedl, a senior policy analyst at The Heritage Foundation.
They came on behalf of the Concord Coalition, which was founded in the early 1990s by former Sens. Warren Rudman, the Republican from New Hampshire, and the late Paul Tsongas, Democrat from Massachusetts, to preach the gospel of responsible fiscal policy. Together with Robert Bixby, the executive director of the coalition, the group met with the Post-Gazette editorial board last week and later went to the University of Pittsburgh for a roundtable discussion.
This was part of a national Fiscal Wake-Up Tour, but the coalition could just as well call it the Pigeons Coming Home to Roost Tour. That's because when the crunch comes, it will be loud and dirty and feathers will fly. Worried about taxes? If entitlement programs keep swelling federal programs, higher taxes may be inevitable as part of a bailout. Worried about threats to entitlement programs like Social Security? Unless steps are taken to correct course, the nation won't be able to afford to keep all its promises to the people.
Former President Bill Clinton remembered his priorities with the saying, "It's the economy, stupid." Today, presidential candidates should pin an expanded motto to their walls: "It's the demographics, stupid." As the coalition members tell it, the coming crisis is advancing in a relentless march of overwhelming numbers concerning entitlement programs, health costs and federal deficits.
They point out that over the next 25 years, the number of Americans aged 65 and up will almost double, from 12 percent of the population to 20 percent. With the working-age sector growing by only 10 percent, the ratio of workers paying into Social Security and Medicare relative to those getting benefits will fall by roughly one-third. The numbers, in short, don't add up except to spell big trouble. Already Medicare and Medicaid comprise 42 percent of the federal budget.
Unless something is done, federal deficits will soar and the nation's permanently rising debt will eventually crush the economy. But what to do? Coming to the challenge with different political opinions and representing a nonpartisan organization, the members of the Fiscal Wake-Up Tour don't advocate one solution over another. They are Paul Revere on a ride to wake up the citizens to the advancing enemy.
They do want the presidential candidates to speak to these issues that cannot be ignored once one of them is in the White House. Unfortunately, tour participants say no candidate is really speaking about the coming crunch right now, except in a piecemeal fashion.
The coalition does have a series of questions to ask the candidates, including this one: "Do you support imposing strong budget controls, such as caps on annual spending, a 'pay-as-you-go' rule for new spending and tax initiatives, and/or putting today's entitlements on a firm, long-term budget?"
It's a good question. In this season of big promises, the American people should insist on a good answer.
First Published March 31, 2008 12:00 am