Washington is known for political posturing rather than positive progress, with the most recent House repeal of the Affordable Care Act of 2010 serving as another example of Washington’s symbolism over substance.
It’s time for Washington to focus on getting things done rather than just doing things, especially in connection with our nation’s deteriorating financial condition. President Obama must directly confront this in his State of the Union address tonight. He must also focus on substance over symbolism and results rather than rhetoric.
Our country is at a critical crossroads. We face a range of key sustainability challenges that threaten our future position in the world and standard of living at home. The largest of these is our nation’s fiscal challenge. It is a much greater threat to our future than the Chinese, Al Qaeda or others. The cold but hard truth is that we have met the enemy and it is us. Washington has been fiscally irresponsible and violating its fiduciary duty and stewardship responsibility for far too long.
Do not be deceived, a debt crisis can occur in the United States. Based on a recent International Monetary Fund report, the U.S. already has total federal, state and local debt figures as a percentage of the economy that are higher than many of the nations that are of concern in Europe.
President Obama should use his State of the Union speech to state the facts and speak the truth to the American people about the true financial and fiscal state of our nation. He must help the American people understand the difference between our short-term deficits which are driven largely by temporary factors and the structural ones that represent the true threat to our nation’s future.
President Obama has a responsibility to provide a vision and a framework to revitalize our economy and create jobs while also taking steps to put our nation’s finances in order. We need a period of relative austerity in government consumption combined with targeted investments, renewed innovation and a more constructive engagement approach with business.
The president must also tell the American people what he plans to do with his Fiscal Responsibility and Reform Commission’s recommendations and how they will be reflected in his fiscal 2012 budget and broader legislative agenda.
In laying out his vision and proposed path forward, he must differentiate between the short-term actions needed to generate jobs and reduce unemployment and those needed to address our nation’s competitiveness and structural deficits.
He should propose a path for reforming social insurance programs, cutting defense and other spending, and engaging in comprehensive tax reform that will generate more revenues. In doing so, he must recognize the need for more meaningful citizen education and engagement and set realistic expectations regarding what can and can not be achieved within certain time frames.
From a practical standpoint, he should take a tough stand on spending, including defense, in his fiscal 2012 budget proposal. After all, discretionary spending increased by over 20 percent between fiscal 2008 and fiscal 2010.
He should also support re-imposing meaningful statutory budget controls beginning in 2013. These controls must be tougher than the ones that helped us restore fiscal sanity in the 1990s. They should include PAYGO rules that do not include trillions of dollars in loopholes, tough but realistic total discretionary spending caps, and specific annual public debt/GDP targets that would begin in 2013 or 2014.
Importantly, these targets would be coupled with automatic enforcement mechanisms to ensure compliance. This would include a specified ratio of spending cuts to tax surcharges that would help to encourage action, while providing an appropriate degree of transparency and accountability if Congress and the President failed to act.
It’s time for truth, transparency and tough choices. President Obama will have the “bully pulpit” during his State of the Union address. He must use it to state the facts, speak the truth, and lay out a vision for how he believes we should proceed. He must call for progress over partisanship and civility over conflict.
He must provide the leadership necessary to enable the Congress to make the tough choices that need to be made before we face our own debt crisis. He also needs to do what is right even though it may not be popular with his base and others. If he does so and Congressional leaders respond with patriotism rather than partisanship, we can get on with doing what it takes to keep America great and our future can be better that our past. If not, his future — and ours — will not be as bright.
David M. Walker, is founder and CEO of The Comeback America Initiative, and former Comptroller General of the United States.
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