MY VIEW: Erskine Bowles and Alan Simpson April 2013

Erskine Bowles and former Senator Alan Simpson (R-WY), the two former co-chairs of the Fiscal Commission, have spent the last two and a half year talking to American citizens about the need to put our budget on a sustainable path and the recommendations put forward by the Fiscal Commission. But while the political landscape has changed over the last couple years, our debt problem remains far from solved.

In today's Washington Post, Bowles and Simpson offer their take on our fiscal outlook, what progress has been made, and what lawmakers need to do going forward:

Unfortunately, in Washington, the past two years have been defined by fiscal brinksmanship. Policymakers have lurched from crisis to crisis, waiting until the last moment to do the bare minimum to avoid catastrophe without addressing the fundamental drivers of our long-term debt.

To be sure, some progress has been made the past two years. Policymakers have enacted about $2.7 trillion in deficit reduction, primarily through cuts in discretionary spending and higher taxes on wealthy individuals. Yet what we have achieved so far is insufficient. Nothing has been done to make our entitlement programs sustainable for future generations, make our tax code more globally competitive and pro-growth, or put our debt on a downward path. Instead, we have allowed a “sequestration” to mindlessly cut spending across the board — except in those areas that contribute the most to spending growth.

But there are seeds of hope that a bipartisan agreement might be achievable.

Our fiscal problem will not be solved unless Congressional leaders and the President can guide their parties to a principled compromise. Political reality dictates that Democrats and Republicans cannot stick to their preferred positions wholeheartedly. Bowles and Simpson recently released a new plan, "A Bipartisan Path Forward to Securing America's Future," showing where a possible "grand bargain" might lie. Bowles and Simpson break down the details of their plan.

The plan we propose would achieve $2.5 trillion in deficit reduction through 2023, replacing the immediate, mindless cuts of the sequester with smarter, more gradual deficit reduction that would avoid disrupting a fragile economic recovery while putting the debt on a clear downward path relative to the economy over the next 10 years and beyond. Importantly, the plan would achieve this deficit reduction while respecting the principles and priorities of both parties.

Our proposal contains concrete steps to reduce the growth of entitlement programs and make structural changes to federal health programs, such as reforming the health-care delivery system to move away from the fee-for-service model and gradually increasing the eligibility age for Medicare. At the same time, it would provide important protections and benefit enhancements for low-income and vulnerable Americans, such as an income-related Medicare buy-in for seniors affected by the increase in Medicare’s eligibility age and greater protections against catastrophic health-care costs for low-income seniors.

Our proposal recognizes that additional revenue must be part of a comprehensive deficit-reduction plan for both substantive and political reasons. Our plan raises revenue through comprehensive tax reform that lowers rates, improves fairness and promotes more vibrant economic growth.

These structural reforms are accompanied by spending cuts in all parts of the budgets put forward by both parties, including cuts to defense and non-defense programs. The plan also includes a shift to the chained consumer price index to provide more accurate indexation of provisions throughout the budget, with a portion of the savings devoted to benefit enhancements for low-income populations. Together, these policies would put the debt on a downward trajectory as a share of gross domestic product — and would keep it declining for the long term.

The "Bipartisan Path Forward" is not intended to be a replacement for the original Fiscal Commission plan but rather a guide showing where a possible compromise may be if both parties are willing to put aside their sacred cows. Write Bowles and Simpson:

Our proposal is not our ideal plan, and it is certainly not the only plan. It is an effort to show that a deal is possible in which neither side compromises its principles but instead relies on principled compromise. Such a deal would invigorate our economy, demonstrate to the public that Washington can solve problems and leave a better future for our grandchildren.

Click here to read the full op-ed.

"My Views" are works published by members of the Committee for a Responsible Federal Budget, but they do not necessarily reflect the views of all members of the committee.