Maya MacGuineas: Let's debate getting our fiscal house in order

Maya MacGuineas, president of the Committee for a Responsible Federal Budget, and Mr. Sandy Cutler, chairman and CEO of Eaton Corp., wrote a commentary that appeared on Cutler also serves as a co-chair of the 2016 Republican National Convention and as a member of the Campaign to Fix the Debt CEO Fiscal Leadership Council. The column is reposted here.

The 2016 presidential primary debate season is upon us, and on Thursday, Republicans will kick things off with their first debate in Cleveland. As the horse race continues, with GOP presidential hopefuls jockeying to be among the 10 selected debate participants, it is important that Ohio and the rest of the country not lose sight of one of the more important issues that should be discussed in the debate: the national debt.

This country's large and growing debt continues to hang like an albatross around the neck of the economy, making it difficult for the country to undergo a sustained recovery. Under current law, the federal debt held by the public is $13 trillion — 74 percent of GDP — or about $105,000 per household. And if nothing is done to change course, the debt will exceed the size of the entire economy in the next 25 years — perhaps even sooner.

Along with excessively high levels of debt will come slower income growth; fewer jobs; and rising interest rates on mortgages, student loans, and credit card payments; and there will be no room for important public investments. And record-high debt levels make it much harder to weather an economic crisis when one next comes along.

Although federal deficits — the amount we borrow in a given year — have fallen in recent years, trillion-dollar deficits are projected to return within a decade. Already, at more than $200 billion a year, interest payments on the debt are the fastest-growing part of the budget.

There is no question that we are on an unsustainable fiscal path, which is why addressing the debt should be a top priority for the 2016 presidential candidates.

Many of the candidates agree that good fiscal stewardship is an important element of economic growth. But most stump speeches on the campaign trail have been long on rhetoric and short on specifics.

Some argue that we can put the country back on a sound fiscal footing by simply cutting waste or raising taxes on the very rich. The reality, noted by Al Simpson, co-chair of the Simpson-Bowles deficit-reduction panel, is that we can't cut our way out of this hole, we can't tax our way out, and we can't grow our way out. We need a combination. And more important, we need to focus on the long-term drivers of the debt: rising entitlement spending as a result of growing health care costs and an aging population.

That especially means reforming Social Security so it remains strong for future generations, and slowing the growth in Medicare so it doesn't double in size over the next 35 years. In addition, tax reform can reduce tax preferences in order to improve simplicity, reduce rates, enhance competitiveness, promote economic growth and increase revenue collection.

What America needs from the 2016 candidates is a bold and specific set of policy initiatives to promote economic growth, reduce deficits and get control of the debt.

The two goals of promoting growth and reducing deficits are not, as some claim, mutually exclusive. Rather, they are mutually reinforcing: Lower debt would promote economic growth, while faster growth would improve the fiscal situation.

The upcoming Republican debate here in Cleveland will be a critically important moment in setting the tone of the national discussion on these issues.

One the one hand, candidates can admit that the fiscal challenges facing the country are a real problem. They can propose a variety of solutions — none of which will be easy. And they can keep options on the table and explain how, as a true leader, each of them would bring people — even those with whom they disagree — to the table to get the deal done.

Or they can fall back on old habits by either denying that the problem exists or focusing on what they would not do instead of what they would do to fix it.

When it comes to fixing the debt, the politically expedient solutions that sound too good to be true usually are.

We can no longer afford to kick this can down the road. The longer we wait to tackle the debt, the more painful the required reforms will be.

"My Views" are works published by members of the Committee for a Responsible Federal Budget, but they do not necessarily reflect the views of all members of the committee.