Management

In This Game of Chicken, We All Lose

Report offers challenging yet pragmatic approach to fixing our nation’s financial woes.

August 07, 2011
KEYWORDS crisis , debt , political
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Report recommendations

The report is the outcome of a two-year project sponsored by the National Academy of Public Administration and the National Research Council of the National Academy of Sciences. The work was performed by a committee representing a diversity of disciplines and practices—people with a wealth of experience with the federal budget and public policy, as well as a wide range of political and policy reviews.

The latter point is important as it reveals that reasonable people can disagree and still form a consensus based on compromise. That is sorely lacking in Washington, D.C. these days.

Much to the nation’s misfortune, the current debate over deficits and debt is dominated by ideologues, not pragmatists. We face the very real possibility of doing more damage than good when wild-eyed partisans act more like Lizzie Borden chasing her mother and father with an axe than the consensus seekers a healthy democracy requires.

“Choosing the Nation’s Fiscal Future” neither “presumes nor recommends a particular path to a stable fiscal future,” according to its editors. “In a democracy, it is not the role of experts from outside the government to decide important policy questions, especially questions of this magnitude. This is the task of political leaders.”

The report also tasks voters to engage in the issues with an open mind, elect officials who understand the challenges, and then hold them accountable for acting responsibly.

There’s the rub, to quote Hamlet. American voters—those citizens who actually do vote—aren’t as engaged about the issue as they need to be. They tend to vote for partisan solutions that hold a strong emotional rather than practical appeal, and they seem to be all over the board when holding lawmakers accountable, voting people and parties in and out each election cycle.

That last point, however, is also a sign of growing voter frustration that manifests itself inefficiently in wide swings in voting patterns.

There’s no short-term solution to our growing fiscal problem, and even the most reasonable solutions will require pain and a willingness to share the sacrifice.

As baby boomers age, the projected growth in three major entitlement programs—Social Security, Medicare, and Medicaid—is unsustainable without large tax increases, major restraints and reform in entitlement programs, or some combination of the two.

The challenge is compounded because we continue to wage two wars simultaneously and, for the first time in history, we also cut taxes as we went to war. This was a recipe for an eventual fiscal disaster that has been made worse by the Great Recession, government stimulus spending, and a tepid economic recovery with little associated job growth.

Next: Painful action required

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