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We can't afford to be cynical about deficits

By John P. Avlon, CNN Contributor
  • John Avlon: A commission is looking for ways to cut the federal deficit
  • Some in Washington are cynical, saying its recommendations are dead on arrival, he says
  • Avlon says the deficit issue is crucial and that entitlements must be reformed
  • He says "our solvency and our sovereignty are at stake"

Editor's note: John P. Avlon is a CNN contributor and a senior political columnist for The Daily Beast. He is the author of the new book, "Wingnuts: How the Lunatic Fringe is Hijacking America."

New York (CNN) -- America is facing trillion dollar deficits and unprecedented national debt. The Tea Party movement has channeled populist anger at out-of-control Washington spending and generational theft.

Now a bipartisan deficit reduction panel has begun to propose solutions to these urgent problems -- but official Washington's response seems to be a collective roll of the eyes. Talk about a profile in cynicism.

The reality is that this panel -- led by Republican former Sen. Alan Simpson and former Clinton Chief of Staff Erskine Bowles -- was formed because Congress couldn't get serious about deficit reduction, despite all their talk.

In January, the Senate failed to muster the 60 votes required to form a panel whose recommendations would have required an up or down vote by Congress. So President Obama announced the formation of this commission by executive order. Their first meeting occurred Tuesday in Washington.

It is easy to pay lip service to fiscal responsibility, but hard to actually enact it -- and both parties are good at playing the game. A decade ago, America finally climbed out of deep deficits under the divided government of Bill Clinton and Newt Gingrich -- decreased non-defense discretionary spending, increased taxes and economic growth all helped. But that legacy was quickly squandered in the unified Republican control of Washington during the Bush years, as the combination of tax cuts and increased spending brought us back into the red.

When President George W. Bush proposed social security reform after the 2004 election, Democrats played the fear card to block reform. And when cost-controls to Medicaid were raised in this year's health care reform debate, Republicans suddenly found the political benefits in scaring people about painful cuts.

There is no way to put America back on a path of fiscal responsibility without addressing entitlement reform -- and neither party has shown the sustained political will to deal with this difficult reality. Our current path is unsustainable.

The baby boomers have begun to retire, and already states and cities are finding their budgets cannot accommodate public sector pension benefits. Entitlement spending will consume all federal tax revenues by 2047 if nothing is done, leaving no dollars left for the essential work of government, such as national defense.

Groups like the Pete Peterson Foundation, led by the former U.S. Comptroller General David Walker, and the Concord Coalition, have been tireless in their warnings about this entirely anticipatable economic crisis, which Walker calls "a fiscal cancer growing within us" and "a tsunami of spending that could swamp our ship of state."

The good news is there is increasing public awareness about this very real danger. American citizens are starting to understand that there are not just economic but geo-strategic dimensions to this accelerating crisis -- the USA cannot remain the world's sole superpower while also being the world's largest debtor nation.

There is also reason for some optimism -- bipartisan panels have worked to reform entitlements and reduce spending in the past. The Reagan-backed Greenspan Commission extended the life of Social Security back in the 1980s. The Hoover Commission, convened by President Harry Truman and led by former Republican President Herbert Hoover, offered recommendations on how to streamline the federal government in the wake of the New Deal.

But the new bipartisan deficit reduction panel has been greeted by cynicism that stems from the current culture of hyper-partisanship. In recent decades, Republicans have delinked fiscal conservatism from fiscal responsibility, deriding balanced budget measures such as "pay-go" as backdoor guarantees of tax increases.

Tuesday, the Republican National Committee called the bipartisan effort a "Show Me the VAT" Commission in an attempt to dismiss it before its work has begun (VAT stands for "value-added tax," a tax on consumption). Liberal Democrats remain allergic to serious spending and entitlement cuts, preferring a tax-fueled embrace of an expanded welfare state.

And so the stage is set for what passes for conventional wisdom in Washington -- that the commission's recommendations will be dead-on-arrival when they are announced in December of this year.

That's when citizen advocates need to stand up for fiscal responsibility and demand that the commission's recommendations receive at least an up or down vote in Congress.

Constructive criticisms are welcome, but no honest advocate of fiscal conservatism can afford to ignore this opportunity for bipartisan deficit reduction.

For President Obama, strong backing of the commission's recommendations will be essential to repairing the credibility gap that has emerged between his campaign promises to "restore fiscal responsibility" and the unprecedented federal spending he embraced as a means of pulling us out of the fiscal crisis.

The unspent billions from the stimulus bill should be on table as well -- and a truly courageous Nixon-in-China move would have the president separately champion entitlement reform from the bully pulpit of the White House, as he promised The Washington Post editorial board before taking office.

As part of the post-baby boom generation that will be left holding the bag after decades of unsustainable spending, I know America cannot afford to wait for another solution to this long-term crisis. The perfect cannot be the enemy of the good. Our solvency and our sovereignty are at stake. The time for a return to fiscal responsibility is right now.

The opinions expressed in this commentary are solely those of John P. Avlon.