Can Our National Leaders Pass the Test?
Most everyone – from President Obama, Speaker Boehner, and lawmakers from both sides of the aisle, to renowned economists – agrees that allowing sequestration to occur would be a less than ideal way to tackle our debt problem. The across-the-board spending cuts on domestic and defense budgets will lead to furloughs and layoffs, and don't address inefficiencies in entitlement programs and the tax code, the major drivers of the debt in the future. However, we need to do something to reduce the deficits, and the worst outcome would be to cancel the sequester without offsetting it.
These spending cuts need to be replaced with a comprehensive debt deal containing critical reforms that put our national debt on a downward path as a share of our economy. On Friday, the Fix the Debt campaign released a grading scale that shows how to score our national leaders on the deal they reach (or not). The fate of our economy in both the short and long term depends on what lawmakers do.
To get an A, lawmakers would have to replace the sequester with a plan that would put debt on a clear downward path as a share of the economy, which our recent analysis found would require $2.4 trillion in additional savings over ten years compared to current policy. The grades fall as the sequester solution gets less comprehensive. Lawmakers earn a B if they offset a permanent repeal of the sequester, a C if they offset a one-year repeal, and an F if they delay the sequester without offsets. Allowing the sequester to happen gets an incomplete grade due to its insufficient amount of long-term deficit reduction.
Hopefully, lawmakers go for the highest grade and make additional reforms to health care and Social Security that would make those programs sustainable over the long term. Given the strong support from American citizens, we hope our national leaders step up to the plate and reach a bipartisan deal to solve our budget problem.
Click here for the full-scale report card.