Facts, figures and wise cracks were tossed around the stage
in equal measure Wednesday night, but Erskine Bowles and Alan Simpson made
clear the federal budget and congressional gridlock are no laughing matters.
"If Congress doesn't wake up, we face the most
predictable and avoidable economic crisis in history. This fiscal path is not
sustainable," said Bowles, who along with Simpson chaired a national
bipartisan commission on the budget and the federal debt. The two spoke in Page Auditorium in a session
moderated by Sanford professor Philip Bennett.
"We knew we succeeded when we pissed off everyone,"
Simpson said of the commission's plan.
Bowles, former White House chief of staff and president of
the UNC system, and Simpson, former U.S. Senator from Wyoming, were tasked by
President Obama with creating recommendations to balance the federal budget by
2015 and address the deficit. The plan was completed in December 2010 but has
not been acted upon by Congress.
Bowles outline four main drivers of federal debt: health
care costs, defense spending, the tax code and interest on the debt. The United
States spends twice as much as any other country on health care but ranks low
on several key measures of health outcomes. Defense spending is greater than
the spending of the next 14 largest countries combined. The tax code is
antiquated, inefficient, anti-competitive and riddled with earmarks and
expenditures. Without serious reform, interest on the debt could reach $1
trillion a year by 2020.
"Of all the revenue raised in 2011, 100 percent of it
was consumed by entitlements and interest," said Bowles. "The rest of
the money spent on wars defense, education and infrastructure was borrowed and
half of it borrowed from foreign countries." The problem can't be solved
with just growth or just tax increases or just budget cuts, he said.
The commission's plan includes a combination of budget cuts
and tax reform, including changes in entitlement programs such as Medicare and
Social Security and cuts in defense spending. It also includes changes to the
tax rates to increase revenue that are politically challenging. "People
act like raising taxes means [anti-tax advocate] Grover Norquist will come to
your house and put a curse on you," Simpson said.
They both stressed that the plan was shaped to take the
recession into account and to protect the most vulnerable Americans.
When Bennett asked why President Obama didn't embrace the
plan when it was submitted, Simpson said, "He would have been torn to
ribbons by his base." His economic
guys were thrilled with the plan, but his political guys said to lay low,
Simpson said.
"There is no trust in D.C.," Simpson said. "It used to be if you shook hands and
kept your word, it was OK. Nobody gave me the Jesus shoes to judge people, but
it is sad to watch."
The two men are working with members of both the House and
Senate to put the plan into legislative language. The current congressional gridlock and
political polarization in the county makes action on the commission's plan
unlikely in an election year, but they hope to introduce the legislation as
soon as next month.
The talk was a Terry Sanford Distinguished Lecture,
sponsored by the Sanford School of Public Policy and part of the school's
series, "Gridlock: Can Our System Address America's Biggest Problems."
The event was recorded by WUNC and will be broadcast on the program "North
Carolina Now" over two nights, Thursday, January 19 and Friday, January
20.
Pictured below, Simpson and Bowles meet with Duke students prior to the talk. Photo by Megan Morr
