This year’s budget debate comes as we are in uncharted waters. President Barack Obama, Congress and leading economists all know we are living on borrowed time. If we don’t make a major course correction with regard to the federal budget, a major course correction will be forced on us — sooner rather than later. As The Washington Post has reported, administration officials call this a “forcing event.”
Federal Reserve Chairman Ben Bernanke alluded to a coming forcing event when he testified to Congress this month that our unsustainable deficits and debt “cannot actually happen, because creditors would never be willing to lend to a government whose debt, relative to national income, is rising without limit.”
Waiting on a crisis could lead to a downgrade of the nation’s credit rating, a sudden spike in interest rates, a loss of confidence in the dollar or any combination of events that could send our economy into a tailspin.
The president and Congress have failed to inform the public about how damaging these events could be. Unemployment could reach 20 percent, real gross domestic production could decline 10 percent to 15 percent, the bottom would fall out of the middle class, and low-income families would have no hope of a recovery. Waiting on this crisis before acting would be like waiting for an opposing army to invade before deciding how to prepare a defense.
Leaders prepare nations for coming challenges. As elected officials, we cannot expect Americans to make sacrifices if they are unaware of the urgency and magnitude of the problems before us. We also cannot expect them to follow our advice unless we model sacrifice.
That’s why in the coming budget debate, everything has to be on the table. There can be no sacred cows and pet priorities. Most of all, the American people have to know that we are willing to sacrifice our political careers in order to do the best thing for the country. We have to resist the tendency to play “gotcha” politics and, for once, unite behind the theme, and reality, that our survival depends on the decisions we must make.
The president had an opportunity to provide leadership in his State of the Union address and in his budget but declined. Without presidential leadership, any serious effort to reduce spending and reform entitlements will fail. Thankfully, the power of the presidency gives him the ability to pivot whenever he chooses.
For the president, dealing with our debt threat could be his “Nixon goes to China” moment. Only a liberal Democratic president may be able to reform entitlements.
Fortunately for the president, those of us who backed his own debt commission’s plan already have gone to China. Sens. Dick Durbin, D-Ill., and Kent Conrad, D-N.D., committed the heresy of backing some entitlement reform. Sen. Mike Crapo, R-Idaho, and I backed tax reform that would lower rates dramatically, stimulate economic growth and generate revenue by doing away with dysfunctional subsidies such as that for ethanol.
Sens. Saxby Chambliss, R-Ga., and Mark Warner, D-Va., are inviting other members to join our delegation. If the president decides to go to China, he’ll find plenty of company. We’re all waiting for him.
Congress, of course, can do more. We have to offer solutions of our own, conduct aggressive oversight and cut spending. Cutting discretionary spending is not a cure-all but will help us regain the credibility we’ll need to reform entitlements. If the president and Congress are not interested in dealing with the debt, I’m happy to spend the entire year debating hundreds of amendments cutting spending in every area of government, including defense.
The American people will hear many viewpoints from politicians in the coming weeks about how the competing budgets on Capitol Hill will affect their future. Some of these views will be thoughtful, but many will be self-interested and divisive. Some arguments will give good-faith estimates about where we are, but many will fudge the facts to advance one party or political career.
What America needs now is not division and posturing but real leadership. Instead of campaign rhetoric, the president and Congress need to launch a campaign to educate the American people about this seminal moment in our history.
How we respond to our looming debt crisis will determine whether we follow the path of previous republics that drowned under a rising tide of debt or whether we cheat history and continue the great and historical claim of American exceptionalism.
U.S. Sen. Tom Coburn, a Republican senator from Oklahoma, was a member of the president’s fiscal commission.
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