Some years ago I was sitting in a members meeting as a Wilmington area country club president was explaining his conundrum in trying to determine how to finance a renovation project. The difficulty in pleasing his club member constituents, he said, was that about half of them believed that we should never, ever borrow money while the other half believed that we should never, ever sell land.
I have been reminded of this amusing summation as the slow motion train wreck that passes for our Federal budget process unfolded during the past few weeks. Perhaps not quite half, but a good portion of us believe that we must never, ever increase taxes and a good portion of us believe that we must never, ever cut spending. This has proved to be a recipe for further ratcheting up the intensity of partisanship in Washington while producing bad public policy.
It has been pretty clear for at least a generation that members of Congress are nearly incapable of disappointing us as they consider taxing and spending priorities. I worked at the Congressional Budget Office under its first Director Alice Rivlin more than thirty years ago, and witnessed the efforts of the newly established House and Senate Budget Committees as they struggled at once to tame the flow of red ink and assert their fledging jurisdiction in the face of resistance from the all powerful taxing and spending committees. It is no wonder that with the notable exception of the mid to late 1990s when we all enjoyed a debt fueled economic expansion, we have seen steadily increasing Federal budget deficits.
The current standoff is all the more frustrating to witness in light of the good work done just last year by the Bowles-Simpson Commission. Unlike many blue ribbon panels, this one actually confronted the stark challenges before us and refused to punt on the tough calls. The co-chairs forged a consensus on many of the most divisive issues that have hamstrung the Congress and produced a sweeping set of detailed policy recommendations. The Commission proposed that we reduce tax rates and simplify the tax code while eliminating most deductions and corporate subsidies, increase Social Security payment thresholds and delay the eligibility age to 69, cap Medicare and Medicaid spending, and slash military and other government agency spending.
The beauty of the Bowles-Simpson plan was that it angered everyone. All of the special interests and ideologically driven advocacy groups were offended. The co-chairs managed to herd all of the sacred cows of our modern military-industrial-social welfare society into one big metaphorical corral and slaughter them before our eyes. More than that, the underlying political message was clear: the only way to reconcile the views of those on the left and the right is to force the Congress to adopt unpopular measures in a comprehensive package that will please no one.
It’s still out there, the Bowles-Simpson plan. Like many commentators, I wish that President Obama had offered a full throated endorsement and repeated his calls for adoption of comprehensive reform on a daily basis since last November when it was issued. I wish that the stimulus spending would have done more than it apparently has to stimulate our economy, though of course we don’t have a control case so it is hard to know how bad it would be if we had not spent those funds. I also wish that those Republicans who are so concerned about our deficit had objected when the Bush administration went to war in Iraq and Afghanistan, passed Medicare Part D for outpatient drugs to seniors, and cut taxes. But none of this happened, and we are where we are.
We may yet avoid default, and perhaps even avoid a downgrading of our national credit worthiness. But the real work has not been done. We have not meaningfully cut spending, we have not streamlined our Federal government, we have not reformed the tax code, we have not limited the ever increasing costs of our entitlement programs.
Our political system appears incapable of working effectively to adopt these comprehensive reforms, and it will not improve so long as Americans remain fundamentally divided over the best course for our nation. In the words of the late Walt Kelly, the creator of the character Pogo, “We have met the enemy, and he is us.”