This week on Facing the Future, Rachel Snyderman, Managing Director of Economic Policy at the Bipartisan Policy Center (BPC), discussed why the growing debt poses risks in areas such as housing, healthcare, and the workforce. Also, Erica Patella, Program Coordinator for the annual Fiscal Challenge, joined us to discuss this year’s competition in which student teams from colleges and universities around the country devise and defend their own plans for putting the federal budget on a sustainable path.
In September, the BPC launched a series of issue briefs on why the growing public debt poses risks to the U.S. economy, not just in a general sense (which it does) but also in very specific sectors.
Snyderman explained, “This has been truly a labor of love across our organization ahead of what we know is going to be a tremendously busy time for fiscal and tax policy in 2025. These really large, significant, abstract numbers, $5 trillion in tax cut expirations, a national debt that’s going to eclipse $36 trillion this month – [it’s] really hard to conceptualize what these numbers mean – and also how they impact our decisions when it comes to real kitchen table issues. At BPC, we have extensive expertise in these fiscal and tax policy issues but also in several policy issues that span from housing affordability and housing supply to energy, innovation, and climate resilience to healthcare, access and sustainability of human capital, and how we are supporting the next generation and families. What we sought to do with this project is really leverage that wide policy expertise and explain why the concerning U.S. fiscal outlook matters to many of these different sectors of the economy in a way that we hope is resonating with the American public, with voters, but also with leaders among these respective sectors.”
As an illustration, she told us “we started this series looking at the housing sector. This has been an area where disproportionately Americans have felt the impacts of persistent inflation over the past years. We’ve seen this reflected in elevated mortgage rates and in the rising costs that renters are facing. What we sought to explain was that the 30-year fixed mortgage rate moves quite closely with the 10-Year Treasury rate. In a time where we see elevated interest rates, mortgage costs can be impacted. We also know that on the supply side rising net interest costs on the debt can increase the rate of private investment costs. And so what we’re showcasing is that, especially within this industry it’s not a time to panic, but it is a time to recognize that there are very close connections between what we see in the broader macro environment, and how those threats are felt both on the housing demand side when it comes to folks wanting to buy their own home or rent a new home, and also on the the supply side when it comes to the construction and manufacturing side of the sector.”
Moving on to this year’s Fiscal Challenge, Patella told us that students who are interested in competing can “start out by reaching out to a few friends and classmates. Teams are made up of two to six students, but a lot of times there will be more students working behind the scenes. There’s one official team allowed per university, but we also allow independent teams.”
“For our first round, which is due in March,” she explained, “they produce a 20-minute video with a proposal of policies to address the national debt over the next 30 years. They’re trying to reduce the debt to GDP ratio to 95 percent. However, if they want to choose a different target they’re able to do that if they defend it.”
Teams chosen to advance to the second round get to come to the nation’s Capital. “We host our finals in the morning,” Patella said. “Each team gets to present their presentation to our panel of judges, which we fill with wonderful representatives from organizations such as the Congressional Budget Office, the Bipartisan Policy Center and The Concord Coalition, and they get to have a back and forth with real policymakers on what they have developed. In the afternoon, we also have a wonderful networking event.”
“There’s no right answer,” she said. “That is what students realize. And that doesn’t stop them. They still want to find a path forward, and no one’s figured this out yet. We are all still working on it, but it’s inspiring to watch them put in the work and get this opportunity to showcase what they can do on a national stage.”
Hear more on Facing the Future. Concord Coalition Executive Director Bob Bixby hosts the program each week on WKXL in Concord N.H., and it is also available via podcast. Join us as The Concord Coalition team discusses issues relating to national fiscal policy with budget experts, industry leaders, and elected officials. Past broadcasts are available here. You can subscribe to the podcast on Spotify, Pandora, iTunes, Google Podcasts, Stitcher, or with an RSS feed. Follow Facing the Future on Facebook, and watch videos from past episodes on The Concord Coalition YouTube channel.
