The deficit, euphemisms, and hard choices

To reduce the deficit, politicians need to start being more frank in their discussions

By , Guest blogger

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    Carol McKenna, a Medicare recipient, displays the medicine she and her husband take in her home in Pembroke Pines, Fla., on January 23, 2011. Cutting spending on Medicare is necessary to reduce the deficit, writes guest blogger Howard Gleckman.
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If we are going to make real progress on deficit reduction, politicians will, sooner or later, have to stop talking in code. The “adult conversation” they pine for will have to be candid and explicit. So far, it is not.

Two weeks ago, a bipartisan group of 64 senators signed a letter urging President Obama to “engage in a broader discussion about a comprehensive deficit reduction package.” This conversation, said the lawmakers, should include “discretionary spending cuts, entitlement changes, and tax reform.”

No it shouldn’t. It should include discretionary spending cuts, reductions in the growth of social insurance programs, and tax increases coupled with broad-based reform.

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At the same time, House Ways & Means Committee Chairman Dave Camp (R-MI) told the Wall Street Journal that he wants to lower the top tax rate for individuals and corporations to 25 percent. Well, don’t we all. What he didn’t say was in order to get there without adding to the deficit , we are going to have to slash cherished tax deductions, credits, and exclusions by about $2 trillion over a decade. And even that wouldn’t move the country a millimeter down the road of fiscal balance. It would only leave us no worse off than today.

Today, a bipartisan group of 68 respected economists and policy experts (including my Tax Policy Center colleagues Donald Marron, Rudy Penner, Gene Steuerle, and Bill Gale) signed a letter calling for fiscal consensus based upon “the recommendations of [President Obama’s] Fiscal Commission.” But they carefully added, lifting the words of the senators’ letter, “we may not agree with every aspect of the Commission’s recommendations.”

Don’t get me wrong. It is a good thing that 64 senators of both parties are willing to engage, however hesitantly, in deficit reduction talk. And it may even be helpful when 68 policy experts urge them to keep it up. It certainly beats the alternative. But at some point, Obama and Congress are going to have to, as an old football coach used to say, quit tippy-toein’ through the tulips. Sooner or later, they will have to move beyond the indulgence of obfuscation.

In private, politicians and policy wonks shake their heads at an America that believes the deficit can be fixed by eliminating waste, fraud, and abuse and cutting foreign aid. But why wouldn’t people believe this? After all, this sort of magical thinking is comforting, and their political leaders won’t tell them the sad truth.

Instead of euphemistic mush, imagine instead a letter that says the following:

“Our long-term deficits are not sustainable. They threaten our standard of living and that of our children. To control these deficits, we are going to have to work together to reduce the growth of all government spending. We are going to have to find ways to spend less on health care through Medicare, Medicaid, and other government insurance programs. We are going to have to raise payroll taxes and slow promised increases in Social Security benefits while improving the program for those who most need it. And we are going to have to reform the tax system so it can produce more revenue to support the needs of a rapidly aging population even as we make it fairer, simpler, and more efficient.”

The good news is we still have time. The bond vigilantes have not yet targeted the U.S., as they have Greece, Ireland, and Spain. But pols (and economists) must use that time to educate the public about the deficit and its solutions in plain language, and not in Inside-the-Beltway code. If not, time will run out and Americans will still be trying to figure out what the heck their leaders were trying to tell them.

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