May 23, 2018
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Deficit Confrontation

It’s all on the table — tax policy, Social Security and Medicare, unfunded wars and a hefty defense budget. Thanks to a White House commission drafting recommendations for addressing the federal government’s ballooning budget gaps, elected officials will soon come face-to-face with the fiscal realities of the post-great recession era.

The National Commission on Fiscal Responsibility and Reform, an 18-member bipartisan panel, was charged with crafting a plan to bring spending back in line with revenue. Those recommendations were not to be issued until 14 of the 18 members endorsed them; that goal has been rolled back. On Friday, 11 members of the panel voiced their support, although a formal vote was not taken.

The commission continues to work to gain greater majority support for its ideas, which range from simplifying the federal tax code to reduce rates while eliminating exemptions to raising the retirement age for Social Security to cutting military and other government spending.

The package of recommendations is supposed to be submitted before Congress for an up-or-down vote. Like the Defense Base Closure and Realignment Commission, or BRAC, which recommended a list of bases to be closed in the post-Cold War era, the deficit panel’s proposals could give members of Congress some political cover.

With the federal government that takes office in January split, deficit solutions can become political fodder or the parties can confront them responsibly. Even if the parties take the high road and don’t succumb to trying to score points for the next election, the process will be difficult because spending reflects priorities. The parties have very different priorities.

The wars launched by the Bush administration will cast long shadows on spending over the next several years. But eventually, most troops will return home and expenses will diminish. But challenging questions remain. How much military spending can the nation afford? Will the U.S. continue to act as the sole surviving superpower, policing world conflicts? Does it need standing forces capable of mounting campaigns in two parts of the world at once?

And then there are Social Security and Medicare. Both are tied to promises made to our elders, inspired by the appalling reality of people in their 60s and 70s living in poverty and illness. But should these promises be extended to everyone, even those who are making more than $250,000 a year?

Tax policy also must be weighed. Should the wealthy, who 50 years ago paid a 70 percent income rate, pay more than 28 percent, the current top rate?

Revenues from a growing economy will eventually swell government coffers. But this is where discipline must reign. The president and Congress must build new budgets around a more circumscribed view of what government is charged with doing. The two-year wage freeze on federal employees is a small step in that direction, though it is more symbolic than substantive.

Democrats and Republicans both must be willing to watch favorite programs downsized. The commission has the opportunity to make that easier by generating a bipartisan set of recommendations. Even if it takes more time, the goal of 14 members endorsing the plan is worth it.

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