A Short History of CRFB's Budget Simulators
Congressional Quarterly's John Cranford has a nice profile of CRFB's "Stabilize the Debt" budget simulator. If you have not done so already, it is worth a run-through to get an idea of the kinds of choices that must be made to put debt on a downward path. Interestingly, Cranford also reminds readers of past efforts CRFB has done to quantify the impact of different budget options:
“Hard choices,” in fact, has long been the name of a particular exercise in meeting the increasingly difficult challenge of keeping federal spending and revenue in line. Pioneered a generation ago by the Committee for a Responsible Federal Budget — the original roost for deficit hawks in Washington — the hard choices exercise is so antediluvian that it once was passed around town on floppy disks. In that form, it was a parlor game that appealed mostly to the wonky denizens of Capitol Hill and K Street.
The predecessor to the Stabilize the Debt simulator was called “An Exercise in Hard Choices,” conducted with a pencil and paper scorecard. Besides the changes in technology since the 1998 version of the game, the debt path the country currently faces has changed tremendously. Back then, CBO had projections of future surpluses -- which actually came that year, earlier than expected -- and declining debt in the medium term (although a long-term problem still loomed). Now, the problems that used to be confined to the long-term horizon are now much closer, and the government's fiscal position has deteriorated significantly. As a result, the game feels much harder than it used to be, and it makes accomplishing the goal even more urgent and important.
The 1998 game reminds us that our fiscal balance can change as fast as the technological changes in our simulator. The tough decisions we put off now only make future reform that much more difficult. As Cranford says:
What’s best about the CRFB debt simulator is how clearly it shows the enormous difficulty — political and economic — that confronts anyone who wants to untie this Gordian knot. You’ll need tax increases — lots of them. You’ll need to reconfigure the big entitlements: Medicare, Medicaid and, yes, probably even Social Security. You’ll need to sacrifice some favored spending programs even while giving others a boost. Whoever solves this will need to be smart, creative, diplomatic and dispassionate.
There's no doubt, stabilizing and ultimately reducing the debt as a share of the economy will be hard. But the problem will only get harder to fix the longer we wait, and the actions we take now will be well worth it in the future. Hopefully, "Stabilize the Debt" can help get the message out and make fiscal reform a reality.