By Maria Saporta
The “Gang of Six” is the nation’s best hope to address its gargantuan budget deficit.
That is the opinion of Erskine Bowles, a Democrat who was one of the co-chair’s of the White House’s National Commission on Fiscal Responsibility and Reform. The other co-chair was Alan Simpson, a Republican and a former U.S. senator.
Bowles spoke at Monday’s Atlanta Rotary Club when he talked about the urgency for the United States to reduce its mounting debt. Bowles was in town to attend the Cousins Properties annual meeting that will be held on Tuesday at 11 a.m.
The “Gang of Six” includes two Democratic senators and two Republican senators who were part of the Bowles-Simpson Commission as well as U.S. Sen. Saxby Chambliss (R-Georgia) and U.S. Senator Mark Warner (D-Virginia).
The commission released its recommendations last December that called for a multi-pronged approach to reduce the nation’s debt — increase the age of Social Security eligibility, pass major cuts in defense and foreign policy spending, implement far-reaching tax reforms including the reduction or elimination of several tax deductions.
“The solutions are all painful, and there is no way out,” Bowles said. “We face the most predictable economic crisis in history. It’s just plain arithmetic. The path we are on today is simply not sustainable — no way, no how.”
To make his point, Bowles said that the revenue that the federal government collected last year would only cover mandatory entitlement programs and the nation’s interest on the debt. That meant that every other government program — education, infrastructure, transportation, environment, housing, research (also known as discretionary spending) — were paid for with borrowed money.
“By the year 2020, we will be spending over $1 trillion in interest costs alone. That’s $1 trillion that will be spent in Asia to beat our pants off.”
Bowles said that the nation can’t “grow” or “tax” its way out of this problem. It will require a combination of budget tax, some tax increase (or fewer incentives and deductions), modifications to Medicare, Medicaid and Social Security.
“The ‘Gang of Six’ — they are our best hope,” Bowles said. “Let’s be real. Let’s be serious. If we do that, we can compete with anybody.”
Chambliss and Warner presented their thoughts to Rotary a few weeks ago, and Bowles said it was important to reinforce their messages. The Gang of Six, which will release its recommendations in the next week or so, relied heavily on the Bowles-Simpson commission to frame its own proposals.
There does seem to be a growing consensus that the country has to reduce the federal budget deficit by $4 trillion within the next decade.
Bowles clearly seemed to prefer the bi-partisan “Gang of Six” approach than the proposal presented by Congressman Paul Ryan (R-Wisconsin) or the outline of ideas recently suggested by President Barack Obama.
“I think the hope is Saxby Chambliss,” Bowles said. “The leadership this guy is providing is unbelievable. What is happening with the ‘Gang of Six’ has real potential but he is going to need support. He’s going to be attacked from the far left and the far right.”
Bowles said he expects the ‘Gang of Six’ plan to be “very similar” to the recommendations of the President’s commission.
“I think it really will solve the problem,” Bowles said. “Please encourage Saxby to stay strong and move forward.”