MY VIEW: Judd Gregg July 2013

In the midst of our slow economic recovery, both the public and our Congressional leaders alike can too easily narrow their field of vision to solely short-term concerns, like our 7.6 percent unemployment rate and modest economic growth, or focus solely on long-term problems like our debt path. Some fear that Congress will ultimately end up choosing one or the other, improving today's economy or our long-term prospects. 

In response, former New Hampshire Governor and Senator, Chairman of the Senate Budget Committee, and Co-Chair of the Fix the Debt Campaign, Judd Gregg, recently authored a piece in the Financial Times explaining that not only are both these short and long-term goals accomplishable, but they can also be compatiable. Building a financially sustainable government for our future through smart entitlement and tax code reform will boost investor confidence and our economic outlook today and can be done in a way that does not harm short-term growth. 

Implications that addressing the debt versus the economy is a zero-sum game is false. There’s no reason why we can’t do both. In the commission report and the plan they recently put forward, Mr. Simpson and Mr. Bowles stress the importance of phasing in deficit reduction gradually to avoid harming the economic recovery. Indeed, that is the reason to act now to replace the immediate austerity from sequestration with policies that will reduce the deficit over time. In fact, putting in place a smart, credible debt plan would likely boost the economy by showing markets we are serious about dealing with the long-term debt.

Gregg also underscores that although the growing debt-crisis is often considered a long-term issue, it must be addressed today, even if the changes don't take effect right away.

The threat to Social Security’s solvency is not as hypothetical or as far off as Mr. Luce argues. The trustees who oversee the vital programme have been warning for years that the retirement of the baby boomers will put a strain on the programmed as more workers receive benefits and fewer contribute to it. As the saying goes, “demography is destiny”. The choices facing policy makers will become increasingly unpleasant the longer action is delayed. Waiting until a crisis is imminent will require harsh solutions such as across-the-board cuts for all beneficiaries, including the poorest seniors. In addition, Social Security’s Disability Insurance Program Trust Fund will be exhausted in just three years, underscoring the fact that this is not a distant concern.

Click here to read the full op-ed.

"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.