Reunions: Politicians address federal deficit

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Some of the nation’s leading political voices discussed the federal deficit and the United States’ long-term fiscal health at a panel titled “Strategies for Deficit Reduction” on Saturday morning. The panel, held by the Wilson School as part of the weekend’s Reunions programming, drew a packed crowd to Dodds Auditorium in Robertson Hall.

Wilson School Dean Christina Paxson moderated the forum, which featured Wilson School professor and former Chief of Staff to President George W. Bush Joshua Bolten ’76, Indiana Governor Mitch Daniels ’71, former U.S. Rep. Jim Marshall ’72, D-Ga., and former Press Secretary to President Bill Clinton Michael McCurry ’76.

The panelists reached a consensus that the nation’s deficit required serious attention and commitment but disagreed over the possible solutions as well as the current political impetus for deficit reduction.

Daniels, who was considered a leading candidate for the Republican presidential nomination before announcing last week that he would not be running, noted that the debate over the federal deficit should focus on mathematics rather than ideology.

“I always say we can save the philosophical debate for tomorrow,” Daniels said, noting that “everybody know[s] that the safety net programs have to be transformed.”

Marshall, a conservative Democrat affiliated with the Blue Dog Coalition who was defeated for re-election in 2010, said that, though he agreed with Daniels that the deficit was not sustainable, he remained skeptical about Congress’ ability to deal with it.

“I’m truly pessimistic after having spent the last eight years in the House, which is basically dysfunctional,” Marshall said. “Institutionally, there needs to be some structure imposed that sort of forces change.”

Unlike Marshall, Bolten said he was optimistic about possible deficit reduction, pointing to Daniels’ record as governor as evidence.

“Our problems are, in fact, solvable,” Bolten said. “Mitch has proved that you can be a successful politician and you can govern well without having to give away the store every election cycle.”

Bolten noted that reducing the deficit may be less daunting then it seemed, especially if the economy recovers.

“We don’t actually have to cut any spending — we just have to prevent it from growing at the rate that it’s growing,” he said. “If we have a growing economy, we can solve these budget problems.”

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McCurry, however, noted the need for changes in the country’s tax system rather than deep spending cuts in order to restore the nation’s fiscal security.

“I don’t know — unless if you make some pretty substantial changes in our tax system — I don’t know how we get to where we want to go,” McCurry explained.

Daniels said, that though tax system reform was needed, the real threat to the deficit was economic stagnation.

“If [the Obama Administration] asked the Princeton economics department to go out and design an anti-growth strategy, they couldn’t have done better,” Daniels said. “We have to prioritize economic growth over everything else and right now we’re putting a million obstacles in its way.

Daniels explained during a discussion about federal spending on health care that the true economic debate spoke to larger issues of self-governance, saying that the government needed to decide whether individuals were “creatures of dignity” or “objects of therapy.”

“We’ve got to believe that the American people ... are up to the task of self-governance,” he said. “That’s what this whole thing is about.”

Though the panelists agreed that some reduction was necessary, they differed on whether the political climate was suitable for reform.

“Any kind of tax reform that takes away some of these specialized provisions is going to be extremely difficult,” McCurry said, adding that he hoped the political environment would be friendly to deficit reduction following the 2012 election.

Bolten, however, said that the “demagoguery” of serious proposals, like the recent budget proposal by Rep. Paul Ryan, R-Wis., created a partisan environment around deficit issues. However, he said, there was still hope for some future reduction.

“Both parties don’t have to agree on every certain policy,” he said. “A lot of these problems can be fixed with agreement if there’s a political truce.”