海角大神

Although the 鈥渟uper committee鈥� was by all accounts a 鈥渟uper failure,鈥� the U.S. is fortunate that we are not yet in full blown 鈥渃risis鈥� mode.聽 Our fiscal situation鈥搉amely, the large and economically unsustainable mismatch between spending and revenues鈥搃s still just a 鈥減roblem鈥� that can be solved.聽 Our deficits are still being 鈥渟ustained鈥� at the moment, and U.S. Treasury bonds still look like the world鈥檚 safest investment, thank goodness.

But we鈥檙e on the path to the end of the fiscal sustainability cliff, the edge of which we won鈥檛 see until we鈥檙e likely past it, given how full-speed-ahead we seem to be running toward that unknown edge.聽 (Think Wile E. Coyote chasing the Road Runner.)聽 So it鈥檚 time to at least change the momentum, even if we can鈥檛 so easily just change direction.

The super committee鈥檚 failure was a political one.聽 The super committee鈥檚 task was, and still is, a rather uncomplicated economic one.聽 Given the political constraints and what we鈥檝e learned about what doesn鈥檛 work (putting decisions in the hands of politicians currently in office), slowing down the race to the edge of the fiscal cliff will require getting the public more involved.

Here鈥檚 how Concord Coalition鈥檚 Bob Bixby explained what has to be done in a recent CNN-Money column:

Under current law, $1.2 trillion in spending cuts triggered by the super committee鈥檚 failure would take effect and $4.7 trillion in tax cuts would expire, raising government revenue by significant amounts and lowering future interest costs. According to the Congressional Budget Office, this would bring the budget into 鈥減rimary balance鈥� 鈥� meaning that revenues would cover all spending except for interest payments 鈥� by 2014. The national debt would come down somewhat from 67% to 61% of the economy. More would need to be done, but that鈥檚 not a bad start.

There are problems with sticking to the exact policies and timing of current law, including legitimate short-term economic concerns. Nor should the brunt of any deficit reduction plan be placed on those who can least afford it.

To accommodate those circumstances, Congress could make some changes in the mix and timing of policies but still aim to keep the 10-year deficit-reduction total from current law on track.

Government projections assume the $1.2 trillion in savings Congress intended to back up the super committee, and financial markets are counting on them. Repealing the trigger or reducing its impact would further erode congressional credibility and possibly lead to another downgrade of the nation鈥檚 credit rating.

There is still time for Washington to get things right before expensive, deficit-financed policies are extended. A commitment to a process that enforces strict pay-as-you-go rules and guides policies toward the deficit reduction in current law would help.

And how the public鈥檚 involvement is needed:

The Concord Coalition鈥檚 deficit-reduction exercises and other public engagement efforts in cities across the country have consistently shown that people of all ages and varied ideologies are willing to make hard budget choices 鈥� as long as there is shared sacrifice, with everything on the table.

Members of Congress with differing viewpoints should pair up for 鈥渢wo-by-two鈥� fiscal forums in which they present agreed-upon facts and engage with each other鈥檚 constituents about budget options. Such forums would broaden understanding of the key issues and promote civic discourse about solutions.

A good example was set earlier this year by Senators Mark Warner, a Democrat from Virginia, and Saxby Chambliss, a Republican from Georgia. The two held joint forums in Richmond and Atlanta.

Back in Washington, members should also pair up in co-sponsoring bipartisan plans to address the deficit, with or without the support of congressional leaders. Efforts such as the Senate鈥檚 鈥�Gang of Six鈥� should be revived and expanded. The logical place to start is with the recommendations of the Bowles-Simpson and Rivlin-Domenici commissions.

Congress is now debating the extension of both unemployment benefits and payroll tax cuts.聽 Both policies are typically deficit financed because they are intended as policies that will stimulate the demand for goods and services鈥搇ack of demand being the binding constraint in an economy with high unemployment and other idle resources.聽 The current debate is less over the desire of politicians to extend those policies (most on both sides say 鈥測es鈥�) and more about whether these policies can be and should be paid for鈥搃f their cost can be offset with spending cuts or revenue increases that take place more slowly over the next ten years and do not 鈥渘euter鈥� the stimulative effect of the original policies.聽 Yes, this is indeed possible, with some offsets making more sense than others.聽 Of course, the Republicans would prefer the offsets be spending cuts, while the Democrats would prefer they be tax increases on the rich.聽 So here we are, right back to the same old debate鈥揳nd the same old (mostly political) 鈥渟ticking point.鈥�

My colleague Josh Gordon and I briefly discuss the .聽 Bob appeared live on C-SPAN on Thanksgiving morning with an excellent call-in interview, as well.

I plan to write a bit more about the payroll tax cut and proposed offsets within the next few days, so please stay tuned.

And if you like what you read/watch here about the Concord Coalition鈥檚 initiatives, please make me happy and 鈥渓ike鈥� us (and follow our activities and join us in our efforts) on Facebook, and become a member/get on our mailing list on our website.