David Rohde

Nancy Pelosi, of all people, got it right Thursday morning. In an interview broadcast on National Public Radio, the liberal House Minority Leader agreed that spending cuts and entitlement reforms are necessary.

“The size of our deficit is an immorality, we should not be heaping those responsibilities onto the future,” Pelosi said, sounding oddly Republican. “Finding reductions, subjecting every federal dollar spent to harsh scrutiny as to whether the taxpayer is getting full value for the dollar, is very important. And that holds true in defense as well as on the domestic side.”

Pelosi, of course, could simply be spouting rhetoric. In the same interview, she called for Republicans to “take back your party” from “anti-government ideologues,” praised Tuesday’s last-minute budget deal for creating “more fairness in our tax code,” and said the goal of entitlement reform must be to “strengthen” Medicare and Social Security, not slash them.

But give Pelosi credit for at least admitting that spending cuts are necessary. Since President Barack Obama’s re-election, some on the left have argued that entitlement programs do not need major reform. That alone won’t suffice; like or loathe this week’s tax compromise, it does not create nearly enough revenue to fund our current spending.

The Congressional Budget Office found that the U.S. will amass roughly $4 trillion in deficit over the next decade if current spending levels remain in place. Even with a drawdown of American troops in Afghanistan, the Committee for a Responsible Federal Budget estimates that the U.S. debt will remain at 79 percent of GDP through 2022.

Barack Obama said it himself in his first post-election press conference. Speaking at the White House on November 14, Obama said conversations with families, workers and small business owners along the campaign trail had left him convinced that average Americans deserved more from Washington.

“When you talk to these folks,” Obama said, “you say to yourself, ‘Man, they deserve a better government than they’ve been getting.’”

Exactly.

As 2012 comes to a close, partisanship is slowing our economy, making our children unsafe and reducing our confidence in the future. In 2008, egregious behavior by bankers and regulators could be blamed for gutting the economy. In the 1970s, high union wages could be blamed for reducing the competitiveness of American industry. Today, our political dysfunction is our biggest economic and social liability.

With rising Democratic opposition to cuts in social spending and Republican leaders reiterating their opposition to raising taxes on the wealthy, talks on avoiding the fiscal cliff were at a standstill Thursday.

Officials on both sides of the debate say the political jockeying is likely to continue this week. But they warn that the details of a compromise must emerge next week if an agreement is to be reached in time.

Erskine Bowles, the co-chair of the bipartisan Simpson-Bowles deficit reduction task force, said on Wednesday that he was skeptical that a deal would be reached. Bowles put the chances of an agreement before the end of the year at roughly one in three.