Is deficit debate a new political dawn?
Alan Simpson and Erskine Bowles think it may be a new day in American politics, one where politicans who hike taxes and alter Social Security stay in office.
Simpson, a former Republican senator, tells MSNBC’s “Morning Joe” that he sees evidence of change whenever he strolls through an airport: “I can tell you, we used to get lots of signals. I get more thumbs up now than other digits.”
The pair, co-chairs of President Barack Obama’s National Commission on Fiscal Responsibility and Reform, have proposed cutting the U.S. budget deficit by reducing defense spending, eliminating tax breaks, hiking the gasoline tax and altering Social Security, Medicare and Medicaid.
Those kinds of measures have been a presciption for political suicide up to now, although the recommendations call for lower tax rates overall.
But with voters agonizing over joblessness, the deficit and growing economic powers like China, Simpson and Bowles believe the public wants to hear straight talk about the country’s problems and the steps needed to set things straight.
“Congress people used to believe if they came up here they’d get punished for making tough decisions. I think it’s just the opposite today,” Bowles says. “They will be severely penalized if they take a walk and don’t make these tough decisions and don’t get real.”
Simpson warns specifically against a current argument that says you can eliminate the deficit by banning earmarks, attacking waste, fraud and abuse, and scaling back foreign assistance.
Bejeebers! A scary fiscal outlook and Tea Party politics
Tackling huge budget deficits and growing debt is essential for the United States to avoid a financial market crisis that would push interest rates higher and severely damage the U.S. economy, many economists have warned.
Compromise and statesmanship will be needed to cut spending and raise revenues to narrow the budget gap, and that might not be possible in the current political environment, says at least one experienced budget expert.
“We’re certainly going to have a more fiscally conservative Congress next year,” Rudolph Penner, a former Congressional Budget Office director told a U.S. Chamber of Commerce forum. “The Tea Party, if nothing else, has certainly moved both the Republicans and Democratic Party to the right.”
However, that may not translate into a deficit-reducing budget deal that can pass the House of Representatives and the Senate and then get signed by President Barack Obama, he said.
“A real problem here is that the Tea Party is going to scare the bejeebers out of any Republican that is talking about compromise for fear of what will happen in the next primary,” Penner said. “There is no way we’re going to get out of this problem without a compromise between the two parties.”
Tea Party activists are pushing for deep government spending cuts and have threatened to end the careers of Republicans who go along with tax increases. Democrats are reluctant to cut the Social Security retirement program and Medicare and Medicaid health plans for the elderly and poor.
Alice Rivlin, a former Federal Reserve Board vice chairman and member of Obama’s fiscal commission, said U.S. government spending will rise dramatically faster than the economy can grow as the retiring 77 million-strong baby boom generation begins to draw on promised Social Security retirement and Medicare health benefits. Bringing the budget into balance will take compromise, she said.
Simpson gets delivery from NOW
High drama at President Barack Obama’s deficit commission meeting.
Members of the bipartisan panel were about to settle in at the Senate Budget Committee hearing room to discuss the weighty issues of performance objectives and the merit of one-year vs. two-year budgeting, when the unscheduled happened.
National Organization of Women President Terry O’Neill swooped in with a delivery and proceeded to lecture commission Republican co-chairman Alan Simpson.
“Stop using the deficit as an excuse to cut Social Security,” she said. “The real message we have is don’t throw people out of the middle class by undermining Social Security.”
Then she handed the former senator a bag of baby bottle nipples tied with a bright purple bow to show the group’s anger over remarks Simpson had made comparing the government retirement program to “a milk cow with 310 million tits.”
The comment made in an email to a group that represents older women sparked a howl of protests from liberal groups and NOW called for his removal from the commission.
Simpson ended up apologizing for his comments, but NOW began a “Tits for an Ass” campaign. The group says it delivered 1,500 baby bottle nipples to him. He told O’Neill he would donate them to a children’s hospital.
