A Few Bright Spots Amid U.S. Supercommittee’s Superdivide: View
Although it still has a few weeks to go before its deadline to save the Republic, the supercommittee -- a congressional task force charged with cobbling together a $1.5 trillion debt-reduction package by Nov. 23 -- has not done much to inspire confidence.
Republican and Democratic members leaked the outlines of competing reform proposals last week, indicating a large divide between them and little inclination toward further compromise. A public hearing held by the panel on Nov. 1 didn’t inspire confidence, either. Former Senator Pete Domenici, a Republican, told the committee that its intransigent members were complicit “in letting this great democracy destroy itself because we don’t want to make tough decisions.” Erskine Bowles, formerly President Bill Clinton’s chief of staff, said, “I’m worried you’re going to fail.”
They both have a point. But amid the opprobrium, a few positive developments have been lost. One is concrete, the other more philosophical.
First, although they haven’t divulged detailed plans to the public, both sides on the panel indicated last week that they’d be open to using a chained Consumer Price Index, a technical change that will slow the growth of benefits, for Social Security. If applied to all inflation-indexed federal programs, this reform would save an estimated $232 billion over 10 years.
Beyond the savings, its chief appeal is psychological: It will show that entitlements and revenue are, in fact, on the table for future budget debates.
The second reason for modest optimism is that the unhappiness being expressed in Washington reflects the mood of the public, which at the moment disapproves of its legislature by a ratio of roughly 9 to 1. Popular pressure -- expressed in protest movements like the Tea Party and Occupy Wall Street -- may begin to penetrate the walls of the Capitol in constructive ways. The burgeoning numbers of lawmakers of both parties to “go big,” and strive for savings of $4 trillion, suggests an air of transformation may be stirring.
These developments, though falling short of the high expectations many had for the supercommittee, have set the stage for more ambitious work ahead. Remember that the broader budget fights of the last few years, for all their headaches, have yielded gains: They’ve led to bipartisan proposals for reforming entitlements and taxes.
As we’ve pointed out, there are plenty of budgetary fixes that both Democrats and Republicans can support. Real reform will include overhauling the tax code to eliminate most deductions, broaden the base and lower marginal rates; adjusting Medicare to raise the eligibility age, increase cost-sharing and ensure the rich pay somewhat more for their benefits; gradually raising the retirement age for Social Security and boosting the amount that higher earners pay into the system; and reducing defense spending in ways that don’t harm national security. All this is necessary to straighten out our fiscal problems. And all of it is doable.
So if Congress fails to forge a broad agreement -- and the “most predictable economic crisis in history” eventually unfolds, as Bowles, a member of President Barack Obama’s deficit commission, has put it -- it won’t be for a lack of good ideas. It will be for lack of will.
To contact the senior editor responsible for Bloomberg View’s editorials: David Shipley at email@example.com.