While this year’s high federal deficit is worrisome, far more troubling are the projections of large, unsustainable deficits even after the economy has fully recovered and U.S. military commitments abroad have been scaled back.
But in a guest column in The San Jose Mercury News on Sunday, Concord Coalition Executive Director Robert Bixby emphasized that a wide range of options are available for dealing with the country’s fiscal challenges. The article was printed in conjunction with “Fiscal Solutions Tour” programs in San Francisco on Thursday and San Jose on Friday. (For information on attending, see links below.)
The country’s fiscal options include cuts in defense as well as the domestic spending that Congress approves each year, entitlement programs, more responsible tax policies, and tougher, more effective budget rules in Congress.
“We will probably need options in all of these categories,” Bixby writes. “That's why everything should be on the table. Many steps that need to be taken will require public sacrifice. They will be easy to demagogue. So bipartisan cooperation will be essential. Without change, the fiscal problems will only become more difficult and painful to solve.”
By itself, the current $13.5 trillion federal debt would be manageable, especially with economic growth.
“What we can't afford to do is start running annual deficits of $1 trillion and more in perpetuity,” Bixby warns. “That's something that Congress should keep in mind as members consider irresponsible proposals to use deficit financing to permanently extend the Bush tax cuts.”