This week The Concord Coalition and several other organizations kicked off an initiative called Strengthening of America – Our Children’s Future focused on the nation's worsening fiscal situation. Former Senators Sam Nunn (D-Ga.), Pete Domenici (R-N.M.), Warren Rudman (R-N.H.) and Evan Bayh (D-Ind.) have convened a bipartisan group of former members of Congress for a series of forums in the weeks leading up to the presidential debates. Nunn and Rudman are Concord’s co-chairs.
Speakers at the first forum emphasized that the most difficult problems are more political than economic.
The country has the strength and capacity to deal with its budget challenges, they said. It is the political will to act that is in question, with many elected officials reluctant to make difficult choices and seek bipartisan cooperation.
James A. Baker III, a former Treasury secretary, said in the forum on Wednesday that a grand bargain to put the country on a more responsible path would require “something that’s become a dirty word” in Washington: “Compromise.” He called for a “heroic effort” to achieve such a deal for the sake of the country’s future.
Another former Treasury secretary, Robert Rubin, sounded a similar theme at the forum, which was held at the Center for Strategic and International Studies (CSIS) in Washington. He urged today’s leaders to follow the example of the Founding Fathers, who overcame strong disagreements with each other to produce the Constitution through “principled and effective compromise.”
In introducing the initiative, Nunn said the new project is not intended to “preach doom and gloom and hopelessness” because “we believe there are feasible and responsible solutions that we can pursue to protect our children’s future, if we work together.”
But he cautioned that 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.” That was a recurrent theme throughout the program.
In his opening remarks, Domenici – a senior fellow at the Bipartisan Policy Center -- called the national debt “a silent killer, slowly eating away at our society.” He recalled that a “coalition of the courageous” reached agreement on policy changes in the 1990s that produced four consecutive years of balanced budgets – an example he hoped today’s leaders would emulate.
Domenici noted that today’s unusually low interest rates won’t last forever, a point Baker emphasized as well. Under more traditional rates, Domenici warned, in 10 years the government’s interest costs could exceed defense spending.
Baker, who also served as secretary of state, said the rising federal debt could lead to calls for reduced expenditures on defense and diplomacy, eventually undermining U.S. leadership abroad.
“In the final analysis, our strength abroad depends on our economic health at home,” he said. “You can’t be strong diplomatically, politically and militarily if you are not strong economically.”
While Baker said he hoped a grand bargain would be struck, he described himself as “far from confident” that it would be – particularly if the country continued to experience “divided government.” He said members of the public in both parties as well as independents should “do everything they can to convince our elected officials to make the compromises, however painful, that are necessary if we are to set our country on a sustainable fiscal path.”
Rubin stressed the importance of taking a comprehensive approach to fiscal reform, one that included cost constraints in annual domestic spending, entitlement reform, reductions in the defense budget and a significant increase in federal revenue.
He cautioned, however, that many proposals to reduce or eliminate tax expenditures might be overly optimistic about how easily that could be done. Doing away with tax breaks to both reduce tax rates and bring down deficits, he said, was an appealing idea but “truly a tall order.”
Rubin also warned against “a false choice” between deficit reduction and economic growth, saying “a sound fiscal regime” would increase business confidence, reduce concerns about our political system, and make any economic stimulus measures more effective.
Other members of the Strengthening of America Steering Committee who participated in Wednesday’s forum were former Senator Bill Brock (R-Tenn.), former Senator Byron Dorgan (D-N.D.), former Representative Bill Frenzel (R-Minn.), former Representative Dan Glickman (D-Kan.), former Senator J. Bennett Johnston (D-La.), former Representative Tim Roemer (D-Ind.) and former Representative John Tanner (D-Tenn.).
The next forum will be held Monday, Sept. 17, from 12:30 p.m. to 3:30 p.m. at CSIS, 1800 K Street, N.W., in Washington. It will focus on the national security implications of the debt and on proposed bipartisan plans for fiscal reform. The program is open to the public but reservations are requested; more information is available here.