This week on Facing the Future our guest was Rep. David Schweikert (R-AZ), a member of the House Ways and Means Committee and chairman of the bicameral Joint Economic Committee. He gave us his perspective on what it will take to get the U.S. fiscal house in order, why the budget and the economy are intricately intertwined, and why it is so important to act before a crisis hits.
We also got his candid take on this year’s Congressional budget process, which he said “shows the level of perversity there is on telling the truth about the math.” Concord Coalition Executive Director Carolyn Bourdeaux joined the conversation.
“There’s a lack of understanding the scale of what we’re up against,” Schweikert said. “The fact of the matter is, you’re in a world where there are some solutions, but they require really complex policy – dramatic use of technology, dramatic fixating on things that are curative. Everyone wants to stabilize the budget. They just don’t want to change their business model or force a bureaucracy to change. That’s how you end up with really crappy policy where we pretend we’re going to cut things and then the next budget session we just put the money back.”
“We do things often in a 1990s model,” he explained, “We have armies of lobbyists in the hallways here that are desperate to keep you from modernizing how a bureaucracy, or even business contractors, deliver services because the inefficiency is their profit model. You’re not only battling the avoidance in society of dealing with the debt crisis we’re in. The fact of the matter is, the bond market is on the cusp of actually running the country.”
Schweikert emphasized that, “there are no simple solutions. You’re going to have to do dozens of different types of policies in different committees and they’re all going to have to interact. Much of our public has lived the last decade on a sugar high. Now we have to tell the truth.”
In that regard, Schweikert expressed frustration with the current budget process. “You have the Senate do something that’s absolutely unserious, saying ‘here just throw in another $5.8 trillion,’ functionally raising the U.S. sovereign debt by 25 percent over the next 10 years in a single piece of legislation. And yet, other than a handful of editorials, where was the outrage?”
He warned that time is running out to avoid a crisis. “There’s a way where you could make this work. You don’t pay off the debt, you stabilize it. But you may only have three or four years to do it before the debt financing starts to just consume so much of the available capital that you’re caught in this sort of slow, anemic, debt-laden economy. And that’s not that far off.”
“I don’t understand,” he continued, “because you have members in the House, but particularly in the Senate, they give these wonderful, elegant. emotional motivational speeches about how we need to stabilize debt and deficits and protect the stability of the country and the extraordinary privilege of the U. S. dollar, all these things, and then they knife it. They turn around and do things that basically destroy the economic future, the economic stability, the fact of the extraordinary privilege of the dollar. And people like your group, people like my economists, even myself, we’re sitting here almost shaking, saying, ‘are you really that terrified to tell the public the truth?’”
“It is fascinating,” he said, “but I believe members of Congress ultimately are reflections of their constituents. How many of their constituents at home have any understanding of the scale and the speed that the debt is increasing and the fact that when you borrow money it is a tax? it’s a tax you have to pay interest on. It’s just deferred to the time of your retirement or to your kids’ prosperity, but spending has taxes. It’s just when you finally pay for it.”
Hear more on Facing the Future. Concord Coalition Senior Advisor 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.
