Kerrey and Danforth Sound the Alarm on Long-Term Debt
Former Senators Bob Kerrey (D-NE) and John C. Danforth (R-MO) recently published an op-ed in the Wall Street Journal highlighting the need to address our unsustainable fiscal trajectory and supporting the Time to Rescue United States Trusts (TRUST) Act as an important first step in in doing so.
In the piece, Kerrey and Danforth reflect on their work as chairs of the Bipartisan Commission on Entitlement and Tax Reform in 1994, recalling that while the commission was unable to reach agreement on Social Security or health care program reforms, members were nearly unanimous on the severity of the growing debt crisis.
At the time, the national debt was nearly 48 percent of Gross Domestic Product (GDP). Since that time, the problem has only gotten worse. The national debt is currently larger than the entire economy (100 percent), and we project it to reach 107 percent of GDP this year – a new record. Kerrey and Danforth emphasize that those projections are under current law; if lawmakers were to pass further increases to the debt, like extensions of the 2017 tax cuts or President Joe Biden's Fiscal Year (FY) 2022 budget, it would be even higher.
Urging politicians from both sides to take action Kerrey and Danforth deem the TRUST Act to be a promising approach to solving current fiscal challenges.
The TRUST Act, introduced by a bipartisan group in the House and Senate, would establish “rescue committees” for the major federal trust funds headed towards insolvency over the next 14 years, which includes the Highway Trust Fund, the Medicare Part A (Hospital Insurance) trust fund, the Social Security Disability Insurance trust fund, and the Social Security Old-Age and Survivors Insurance trust fund. These committees would be composed of 12 members of Congress with equal representation from each political party and chamber of Congress. Committees would be responsible for writing legislation to preserve the trust funds, which would receive expedited consideration in the House and Senate. This process would encourage bipartisan agreement in time to address the imminent threat of trust fund depletion.
Kerrey and Danforth conclude with a final push for immediate action:
It’s become all too clear that America can’t build a sound economy on a foundation of unsustainable debt. The longer lawmakers wait to act, the more difficult the solutions will be—and the greater the risks for future generations. The Trust Act offers a sensible way to get started.
Several important trust funds face insolvency in the next fifteen years. Allowing automatic cuts to occur would mean harsh consequences for the American people. The TRUST Act is a strong first step towards reaching bipartisan solutions and securing these important programs.