Is a US debt crisis two years away? Commission chairs call for a fix 'now.'

The credit rating agency Moody's, for one, recently warned that it might put a "negative outlook" on US Treasury debts within two years. That step could pave the way for a formal downgrade of America's current triple-A credit rating.

Virtually all budget analysts agree that the US fiscal path is unsustainable, with the risk that lenders will at some point no longer be willing to finance fast-growing debts. Within a decade, interest costs alone could total $1 trillion a year.

Federal Reserve Chairman Ben Bernanke also adopted the urgent tone recently when he called federal budget problems a "near and present danger" to the economy.

"Creditors would never be willing to lend to a government with debt, relative to national income, that is rising without limit," he warned in a February speech.

Is Washington at a "tipping point" where tough issues like reining in the growth rate of entitlement spending can be addressed?

Some factors would tilt either way.

The case against action includes a big political element. Washington is perennially reluctant to do things like cut popular programs or raise taxes, and the approach of the 2012 presidential election season complicates the path toward bipartisan compromise.

Economically, the US is not the same as European nations like Greece or Ireland, which are now facing debt crises. The US is the world's largest economy, a valued trade partner of virtually every other nation. And the US dollar enjoys status as a reserve currency held by many nations. That can't be taken for granted, but it's not likely to shift over night.

For all the talk of potential crisis, the Treasury pays very low interest rates when it borrows.

The case for action is that, with an economy now starting to recover after a deep recession, its time for the federal government to start setting its house in order. Big stimulus spending, the cost of two wars, and tax cuts (including the recent extension of Bush tax rates) have all contributed to a rapid rise in debt.

The warning from Moody's speaks for itself.

Even if a crisis is not imminent, the nation will have an easier time getting on course fiscally if it acts now rather than if it waits.

Bowles also made a political argument: "We believe that far from penalizing their leaders for making the tough choices, Americans will punish politicians for backing down."

House Speaker John Boehner said recently that Republicans will propose a budget that includes changes to entitlement programs such as Medicare. And a bipartisan group of senators is working to push for a package of budget reforms like those proposed by the fiscal commission, designed to bring federal deficits down to a sustainable level before the end of the decade.

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